Persimmon to increase affordable housing delivery amid forecast of ‘growing market’
House builder Persimmon is expecting to increase affordable housing delivery by around a fifth this year, as its chief executive welcomed the government’s “pro-housebuilding agenda”.
The FTSE 100 firm is forecasting it will hand over around 1,900 affordable homes in 2025, including for shared ownership, to registered providers and councils. This compares with 1,589 homes delivered in 2024.
A company spokesperson told Inside Housing: “We’ve largely secured contracts for what we’ve got planned for [affordable housing] delivery in 2025.”
Persimmon’s positive sentiment comes at a time when other house builders have voiced concern over falling demand for Section 106 homes from social landlords.
The spokesperson acknowledged “challenges” in the market, but said Persimmon had been “proactive” and improved its “relations” with social landlords.
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Overall, Persimmon is targeting between 11,000 and 11,500 completions – meaning homes built and sold – in 2025, across all tenures.
In its annual results today (11 March), the house builder said: “The government has an ambitious Affordable Homes Programme, and we expect this to be a growing market in the coming years.”
Dean Finch, chief executive of Persimmon, added: “The government’s welcome planning reforms and pro-housebuilding agenda demands more of the high-quality, affordable homes which are Persimmon’s core strength, providing a positive tailwind.”
Earlier this year, Iain McPherson, former chief operating officer of Sage Homes and boss of Countryside, joined Persimmon as its UK managing director.
The house builder said today that his “significant experience” in the affordable homes market complemented its “improved relationships” in the segment.
Elsewhere, Persimmon revealed it had spent £58m on building safety works in the year to the end of December 2024, up from £46m the year before.
The firm has completed work on 40 schemes out of the 83 identified with issues. Of the remainder, 21 currently have work on site.
The house builder’s overall provision for building safety work at the year end was £235m. However, this has increased by £25m after a review of costs to finish work, the company said.
It added: “The next 24 months are projected to be the peak period of cash expenditure on this programme. Given our own proactive approach and the sustained significant publicity around cladding and building safety, we do not anticipate substantial new building additions into the programme.”
Persimmon also confirmed that it had booked an impairment of £25m in its annual accounts from its investment in modular house builder TopHat. The write-down in the Goldman Sachs-backed firm was first announced in August 2024. TopHat ceased trading in November.
Persimmon said it was due to a “reassessment of risks within the modular build sector”.
However, the firm reconfirmed plans for a second timber frame factory for its subsidiary Space4, which it said will “provide further efficiency benefits”.
As a group, Persimmon reported a 2% rise in pre-tax profit to £359.1m in 2024, off a 16% increase in revenue to £3.2bn.
It said despite the “potential impact from ongoing macroeconomic and geopolitical uncertainties”, the “underlying market fundamentals remain strong”.
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