Aug 10 Reuters Persimmon on Thursday became the latest British housebuilder to flag affordability concerns from higher mortgage rates, but forecast annual profit in line with its expectations, sending its shares over 2 higher in early trade.

Britain39;s housing market has slowed in recent months against the backdrop of the Bank of England39;s sustained run of interest rate rises since December 2021 aimed at taming persistent inflation.

The FTSE 100 builder did not provide an outlook figure but the market is predicting a more than 65 slump in annual operating profit, according to a companycompiled median analysts39; consensus estimate of 348 million pounds.

While there are potential signs of some mortgage rates reducing from recent highs, market volatility is likely to continue and affordability concerns remain, the company said in a statement, adding it remained on track to deliver its profit expectations for the year.

The group39;s order book a key metric that gauges shortterm sales performance declined 30 from a year ago to 1.6 billion pounds, compared with 2.2 billion pounds in 2022.

As we have seen elsewhere, trading conditions have waned over the last 46 weeks with sales rates falling to 0.41. Pricing appears to remain resilient, but the next big test for the market will be the autumn selling season, said Investec analyst Aynsley Lammin in a note.

The proportion of sales to firsttime buyers fell to 34 in the halfyear period, compared with 42 year ago, the…