Evidence suggests that house buyers are delaying their purchases, waiting for the Bank of England to cut interest rates. UK housebuilder Crest Nicholson had to issue a profit warning, attributing the softened sales momentum since Easter to volatile mortgage rates and buyers’ expectations of lower borrowing costs later in the year.

Additionally, a survey of chartered surveyors indicated a weakening demand for homes in May. Financial markets are predicting that the Bank of England might reduce interest rates in August or September.

Crest Nicholson reported a pre-tax loss of £30.9 million for the six months ending in April, including exceptional costs, compared to a £28.4 million profit during the same period last year. The company noted that while the spring selling season began well, momentum has slowed since Easter due to mortgage rate volatility and the anticipated delay in the base rate reduction.

The upcoming general election is also creating short-term uncertainty, expected to ease in July once the results are known. Crest Nicholson now forecasts adjusted full-year profits to be between £22 million and £29 million, significantly lower than analysts’ expectations of around £38 million. Consequently, the company’s share price fell nearly 12% to 212.4p.