Berkeley Group faces pressure from new home scheme price cap, Goldman says

A £500,000 price cap will be imposed for the upcoming Your First Home equity loan scheme, The Times reported. The threshold is lower than the £600,000 limit set for the previous Help to Buy scheme.

Goldman Sachs analysts said the cap would disproportionately affect higher value regions such as London and the South East where Berkeley Group Holdings predominantly operates.

National volume home builders including Persimmon, Taylor Wimpey, Barratt Redrow, and Bellway would be substantially insulated as their portfolio average selling prices sit comfortably below £500,000, the analysts said.

Definitive localised price caps have yet to be formalised, and granular details are expected to be unveiled in the upcoming Autumn Budget, according to Goldman Sachs.

The proposed £500,000 price cap would pose a headwind for Berkeley given that its portfolio average selling price sits at £546,000, the analysts noted.

A review of live inventory across Berkeley’s digital portal reveals only 43 units in Greater London meet the sub £500,000 criteria. Increasing the threshold to £750,000 would capture 135 units in Greater London, Goldman Sachs said.

Across Berkeley’s UK footprint, qualifying stock remains limited, with only 148 of Berkeley’s 459 listed homes nationwide, approximately 32%, sitting at or below the £500,000 limit.