Berkeley Group's annual results contain a figure the industry should sit with: only 31% of new homes reach handover with five or fewer defects
Berkeley Group FY26 results show 90% of their homes handed over with five or fewer defects, against an HBF industry average of 31%. Pre-tax profit fell 14.7% to £451m.
Berkeley Group published its full-year results for the year to 30 April 2026 on 24 June, reporting pre-tax profit of £451.4 million, down 14.7% on the prior year, against 4,076 home completions across London and the South-East. Within the results announcement was a quality metric that deserves wider attention: 90% of Berkeley's homes were handed over with five or fewer defects. The Home Builders Federation puts the industry average at 31%.
What happened
Revenue fell 4.2% to £2.38 billion and average selling prices declined 8% to £546,000, reflecting a softer sales mix. Forward sales contracted as legal completions outpaced reservations, with cash due on future completions falling from £1.4 billion to £1.0 billion. Operating margin slipped to 18.7% from 20.1%, though it remains within Berkeley's long-term target range of 17.5% to 19.5%. Net cash held at £363 million after £233 million in share buybacks.
On quality, the results cite a Net Promoter Score of +77.9 against an industry average of +61.4 (in-house research, December 2025), and the five-or-fewer-defect benchmark, sourced to the HBF National New Homes Customer Satisfaction Survey published in March 2026. That survey draws on responses from over 36,000 buyers at eight weeks and nine months after completion. Berkeley also announced in April that it is pausing new land purchases and slowing investment, a strategic reset driven by a weaker market and rising regulatory costs including the Building Safety Levy taking effect in October 2026.
Why it matters for developers
The 31% industry average is a commercial signal, not just a quality one. If the HBF's data holds across the sector, most developers are handing over homes where the majority of buyers can expect to report more than five defects. Each unresolved defect is a customer care call, a contractor dispatch, an inspection to close, and a DLP entry. Under the NHQC second edition, in force from 2 March 2026, developers carry tighter record-keeping obligations across the entire customer journey from reservation through aftercare. Under the New Homes Ombudsman's statutory powers, active from September 2026, defects that remain unresolved become formal complaints with binding decisions.
Berkeley's 90% rate demonstrates that the 31% average is not a floor: it is the current state of a problem that is solvable. Berkeley's margin decline shows that quality leadership does not insulate a developer from market pressure. But developers operating closer to the industry average face that pressure plus the operational cost of unresolved DLP workloads, aftercare escalations, and the growing regulatory exposure the 2026 compliance framework creates for persistent defect patterns.
What to watch
The New Homes Ombudsman's statutory powers go live on 7 September 2026. From that date, buyers with unresolved defects have a formal escalation route, with decisions binding on registered developers. The HBF's 2027 CSS results, covering homes completed in the current cycle under the NHQC second edition, will be the first dataset to measure quality against the tighter regime. That figure will show whether the 31% average moves.
How Guided Home helps
With only 31% of homes currently reaching handover with five or fewer defects, the gap between top performers and the rest of the industry is not primarily a build quality problem: it is an operational one. What happens in the final weeks before completion, whether snags are inspected, logged, and closed before keys transfer rather than after, determines whether a developer lands in the top decile or generates a DLP backlog that takes months to clear. Under the NHQC second edition and the incoming statutory ombudsman, that backlog carries formal compliance exposure it did not carry two years ago.
Guided Home's Inspections and Defects module provides structured inspection records, defect logging with contractor routing, and SLA tracking across the full DLP period. Pre-handover inspections are recorded in the platform, each defect assigned an owner and a resolution deadline, and nothing closes without a documented outcome. That creates the audit trail the NHQC requires and the New Homes Ombudsman's complaint process can call on.
Document Assurance validates completion documentation against compliance checklists before responsibility transfers. If the inspection record is incomplete or required documents are missing, the handover does not proceed with a clean record. This is the structural control point that closes the gap between a certificate of practical completion and a genuinely finished property. Document Intelligence auto-classifies incoming documentation and maps it to the correct plot, keeping the completion record coherent when multiple contractors and inspection rounds are involved across a site.
The Executive Dashboard surfaces defect resolution rates and outstanding inspection work at portfolio level, giving leadership the visibility to identify sites where handover quality is drifting before it becomes an ombudsman complaint pattern. The Defect Connectivity Hub integrates with existing contractor and site management tools, including Procore, Trimble Fieldview, and Access Coins, so defect data does not have to be re-entered across systems when a resolution workflow moves between site teams and the customer care function.
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