Shares of MJ Gleeson plc, the Sheffield-based affordable house builder, fell about 7% as it warned of rising cancellations due to a “slowdown” in demand.

In an AGM trading update, Gleeson said that over the past six weeks, Gleeson Homes cancellation rates increased to 41% from 20% in the first 10 weeks of the year.

Net reservation rates reduced to 0.26 per site per week against 0.42 for the same period last year.

“The market volatility and sharp increase in interest rates following the mini budget impacted buyer confidence and caused a significant slowdown in demand,” the firm said.

However, MJ Gleeson said it is “encouraged” by Thursday’s autumn statement, and it expects buyer confidence to recover as the volatile macroeconomic backdrop calms down.

“There are good reasons to hope that an improving outlook for longer-term interest rates will result in greater mortgage availability and affordability,” it added.

It said the outlook for its current financial year will depend upon how quickly the housing market recovers. It believes that Gleeson Homes could deliver volumes anywhere between 1,600 and 2,000 units.

Reporter: Xindi Wei

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