Redrow (LSE: RDW) saw a 5.6% decline in shares, trading at 490.80 pence early Friday, following the company’s disclosure of expectations towards the lower end of its previously guided range for full-year results. The subdued nature of the UK housing market during the autumn selling season is cited as a contributing factor.

In the first 18 weeks of the financial 2024, starting July 1, net private reservations amounted to £384 million, marking a 25% decrease from the £515 million recorded a year earlier.

Redrow’s Chair, Richard Akers, addressed the situation at the annual general meeting on Friday, acknowledging the market’s continued sluggishness. Akers stated, “Following the usual summer slowdown reported in our 2023 results, the housing market has remained subdued through the autumn. The business has had to adapt to this more difficult trading environment in terms of build rate and operating costs.”

The company highlighted that, despite 35% of its private customers being cash buyers, difficulties with mortgage loans lower down the chain have resulted in a higher cancellation rate, rising to 25% from 22% a year before.

The net weekly reservation rate per outlet stood at 0.36 in the recent 18 weeks, a slight increase from 0.34 in the first 10 weeks but a decrease from 0.38 in the first half of the financial year 2023. Additionally, the average selling price experienced a 2.5% decline, dropping from £483,000 to £471,000. Homes turnover for the same period decreased from £650 million to £456 million year-on-year.

Although Redrow operated from 125 outlets in the recent period, up from 120 a year ago, the company anticipates the average number of outlets for the full year to decrease to approximately 113, down from the initially guided 117. The total order book as of November 3 amounted to £864 million, with 66% exchanged, compared to £1.36 billion and 74% exchanged at the same time last year.

On a more positive note, Redrow reported a slowdown in build cost inflation, expected to hover around 7% for the current financial year. The housebuilder is set to release its results for the half-year ending December 31 on February 8.

Redrow shares have seen a modest year-to-date increase of around 4% in 2023, with a 3.9% rise over the last 12 months, reflecting the challenges faced.