UK house prices climb 10% in last year; inflation jumps to 2.5% – business live

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A Barratt Homes housing development near Preston.

Barratt Developments, Britain’s biggest housebuilder, has forecast it will make more than £100m in annual pre-tax profits, as it benefits from the housing market boom and buyers’ rush to complete purchases before the end of the stamp duty holiday.

The company said strong demand for new houses around the country would enable its full-year pre-tax profits, after adjusted items, to reach about £107m in the year to the end of June, slightly above analysts’ expectations.

It also highlighted “a modest increase in the proportion of larger family homes” in its forward sales order book – a further sign that homebuyers are adjusting their priorities in the wake of the coronavirus pandemic.

The housebuilder said its completion levels had bounced back from the pause in construction during the first wave of the pandemic, with it finishing the building of 17,243 homes in the 12 months to 30 June, more than previously forecast. Significantly more homes were completed than a year earlier, but the figure was slightly lower than two years previously.

Barratt said its net private reservation rate was strong and was 30% higher than a year earlier, although this was partly because of the comparison with a period when its sales outlets were closed during the first lockdown. …

The homeware chain Dunelm has benefited from the reopening of its stores in the past three months, with sales up 44% on pre-pandemic levels as the home improvement boom continued.

Dunelm reported strong pent-up demand for homewares from customers who wanted to shop in person in its reopened stores for home furnishings including bedding, curtains, bathroom textiles, cushions, dining furniture and decorative accessories.

Sales doubled in the 13 weeks to 26 June, compared with a year earlier, when Dunelm’s stores remained closed during the first coronavirus lockdown. Total sales during the quarter were also 44% higher than the same period in 2019.

Britain’s inflation rate has risen to 2.5% – its highest level in almost three years – after the easing of coronavirus lockdown restrictions prompted rising demand.

The Office for National Statistics (ONS) said dearer food, secondhand cars, clothing and footwear and fuel prices were the main factors behind a jump in the annual inflation rate from 2.1% to 2.5% in June.

The figure was the highest since the 2.7% recorded in August 2018, higher than the 2.2% expected by analysts and above the Bank of England’s 2% target.

Core inflation, which strips out food, energy, alcohol and tobacco, rose from 2% to 2.3%.

Threadneedle Street policymakers have said they expect rising inflation to be temporary and have signalled it will not trigger an early increase in interest rates from their record low of 0.1%.

According to the ONS, part of the increase in inflation as measured by the consumer prices index was caused by the bounceback in prices after they were depressed during lockdown….

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