Berkeley Group Posts Resilient Results Amidst Challenging Market, Boosts Share Buybacks

The company has now delivered £372 million of the £2.0 billion minimum shareholder returns target under its Berkeley 2035 strategy since 1 December 2024. The next target is a further £528 million by 30 September 2030. Importantly, Berkeley says it is “comfortably on target” to meet that.

There is also a little extra kicker after the year-end. Between 30 April 2026 and 19 June 2026, Berkeley bought a further 686,543 shares for £23.2 million. So the buy-back machine is still running.

Berkeley forward sales and housing demand: caution is still the mood

This is where the market weakness shows up most clearly. Cash due on forward sales fell to £1,006 million from £1,403 million. Forward sales are homes already sold but not yet completed, so this number gives a useful read on future revenue visibility.

Berkeley said underlying sales reservations were around 15% lower than the run-rate of the previous two years. Customer interest is still “encouraging”, but buyers are cautious and there is less urgency, especially for off-plan sales. In plain English: people are still looking, but fewer are committing early.

That is not ideal, but it is not a disaster either. Berkeley says completions ran ahead of reservation rates, which helps explain the lower forward sales figure. It also kept pricing disciplined and achieved values slightly ahead of business plan assumptions, which suggests it has not been slashing prices to chase volume.

Berkeley homes, land bank and Build-to-Rent strategy matter more than one year’s profit

Berkeley delivered 4,076 homes, plus 127 in joint ventures. The average selling price was £546,000, down from £593,000, although management says that reflects mix rather than a straight price collapse.

The real strategic asset is land. Berkeley’s land holdings total 52,763 plots across 59 developments, with estimated future gross profit of £6.4 billion. That figure slipped from £6.7 billion, so it is moving the wrong way, but it is still huge and gives Berkeley a lot to work with.

Management has effectively slammed the brakes on new land buying. It says it cannot currently make its required return on new acquisitions because of tax and regulatory burdens. Instead, it is focusing on re-planning existing sites to improve returns. That feels sensible to me. In a market like this, stretching for new deals would be the wrong sort of bravery.

There was also progress in Build-to-Rent, or BTR – purpose-built homes kept by the company and rented out rather than sold. Berkeley Living now has 1,122 homes across six buildings completed and in production, with three completed sites in lease-up. Lettings velocity and rents are said to be at target levels, which is encouraging, although detailed rent figures were not disclosed.

London housing shortages support the long-term Berkeley investment case

Berkeley spent a big chunk of this announcement arguing that London’s planning, tax and regulatory system is choking housing supply. Stripped of the politics, the important point for investors is simple: Berkeley believes the long-term fundamentals in London remain very strong because supply is badly constrained.

The company says London is delivering less than 10% of its MHCLG annual new homes target. If that is anywhere near the lasting reality, demand should not be the long-term problem. The short-term problem is confidence, planning delays, taxes and whether projects stack up financially.

That helps explain the slightly unusual mix here: weaker near-term trading, but strong conviction from management about long-term value. Berkeley is not behaving like a builder desperate to bulk up. It is behaving like a developer protecting cash, waiting for better conditions, and buying back stock when it thinks the market is underpricing the business.

My take on Berkeley Group’s 2026 results

Overall, I’d call this a resilient update with a cautious undertone. The negatives are real – lower profit, lower forward sales, lower returns, fewer pipeline plots, and management clearly thinks the operating environment is getting harder, not easier.

But the positives are substantial too. Net cash increased, operating costs fell 6% in an inflationary backdrop, NAV per share rose 9.0%, the banking facility was refinanced and expanded after the year-end, and buy-backs are being executed at pace.

For retail investors, this is not a “growth is back” story yet. It is more of a “quality operator defending value in a rough market” story. If confidence returns to the London housing market, Berkeley looks well placed. Until then, the company’s cash discipline and willingness to buy back shares below NAV per share are doing a lot of the heavy lifting.

Useful company resource

You can view Berkeley’s results presentation on the company website here: results and announcements.