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Barratt chief: 'There is no North-South divide'

Barratt Developments chief executive Mark Clare has said the company plans to spend £700 million buying land this year as increased lending in the sector is expected to fuel a housebuilder recovery across the country.

Barratt recently announced plans for 2,500 new homes in Scotland, as it posted a doubling of pre-tax profits in its annual results.

Clare told the AJ’s sister publication Construction News said: “There isn’t a North-South divide; we’re seeing demand coming through right across the country.

‘It’s the same wherever we are – we’re pushing on, opening new developments. We’re actually growing the business again.’

A spate of major housebuilders have announced plans for expansion after posting healthy financial results in recent weeks.

Clare said he expected to grow the business by 5 per cent this year as banks gradually increased their lending.

‘It’s dependent on whether that increase in lending continues; we think it could be the start of some modest recovery – certainly the largest housebuilders are all growing,” he said.

Clare ruled out acquisitions but said the firm planned to spend £700million this year on new sites, with Barratt’s own planning permission and project specifications.

‘We’ve increased output by about 20 per cent over the past two, three years,’ he said. ‘What we’re doing is increasing output in line with demand in the market.

‘We’re extending our business where we can, but doing all of it within the constraints of demand.’

He added that Barratt was investing heavily in an initiative to lower the costs of building low-carbon homes and to enhance supply chain collaboration.

The firm is aiming for delivery of Code for Sustainable Homes Level 4 dwellings at the cost of building a Level 3 home.

‘We’ve got to be building 15,000 very low-carbon homes a year, for a cost that’s not very much greater,’ Clare said. ‘Otherwise we’ll price ourselves out of the market.’

He added that the complexity of the Green Deal was “concerning” and that a lack of understanding would hamstring its effect.

“I think people understand there’s help out there, but there’s no real depth to that understanding,” he said. “It raises awareness, but on its own I don’t think it’s going to deliver that mass refurbishment.”

Instead, he called for charges on inefficient homes, including council tax hikes and stamp duty penalties.

“I think there’s a stage in the future where there’s going to have to be a stick and a carrot, I’m afraid,” he said. “To mobilise so many people to take action is going to require more.”

Readers' comments (1)

  • Mushtaq Saleri

    How about some stick and carrot for creating decent sized well designed (by architects) homes and neighbourhoods that don't just gobble up the greenbelt because it's easier for large homebuilders to make a profit? Landbanks and skewed government subsidies for large companies are no way to plan for a sustainable and affordable future.

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