Vistry CEO: House builders are ‘easy targets’ in cladding crisis

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‘We share the government’s objective of moving things forward for the leaseholders, I’m not sure we’re on the same page with the government as to who should be paid for and how.

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Tea

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The boss of house builder Vistry has urged the government not to choose “easy targets” like developers to fix the crisis.

Greg Fitzgerald told The Standard: “While we share the government’s purpose of moving things forward for leaseholders, I’m not sure we’re on the same page as the government about who should be paid for what and how.

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“We’re probably an easy target, home builders. We make a decent amount of money in a good market and I’m sure other CEOs like me are well paid and have an easy political target. But me Looks like the government needs to think about the entire sector including the suppliers of cladding insulation materials.”

The comments come in response to plans announced at the beginning of the week. Housing and Leveling Up Secretary Michael Gove ordered the industry to stump up up to £4 billion to fix unsafe buildings. The move sparked outrage in every corner of the market, with some developers complaining that the effect was disproportionate.

Fitzgerald said: “We as an industry have built houses in accordance with the government’s building regulations and changes in building regulations.”

He said these were “early days” on government proposals. He and others in the industry will engage with the government in the coming weeks to try to persuade them to broaden their target when it comes to rolling out a bill to fix the crisis.

Vistary – which was created in early 2020 through the merger of parts of Bovis Homes and Galifford Trai – said it is on track to more than double profits this year due to a boom in UK assets. Pre-tax profit is estimated at £345 million, up from £143.9 million a year ago.

The business jumped to completions and sales increased, as well as soaring home prices. Vistari’s average purchase price rose 6% in one year.

Fitzgerald said that Wistry had to “duck and dive” to navigate volatile prices for “bricks, blocks”, [and] timber” and rising labor costs.

“We have seen a 4-5% increase in costs throughout the year,” he said.

Price growth for materials is expected to moderate this year, although wages are still seeing upward pressure.

Vistry expects to “take a significant step forward in profits and returns” this year, the company said, flagging the possibility of a share buyback or a special dividend. It promised an update on the impact of cladding treatment plans on its bottom line after the government gave full details.

Shares fell 10.5p, or 0.9%, to 1152.5p.

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