Building on confidence.

Housebuilders upbeat about market improvement

Published:  13 July, 2009

COALVILLE: Barratt Developments and Redrow added to Friday's upbeat market assessment by Persimmon.

Mark Clare, chief executive of Barratt said: "The early signs of stability we reported in May have continued. On sales we saw the return of the traditional spring selling season...and since the New Year, our prices have been stable overall."

Steve Morgan, chief executive of Redrow said: "The one thing you will see today on most of our sites that you wouldn't have seen six months ago is the build process taking place."

Barratt has began work on new sites and over the next six months plans to open 70 to 80 such sites, although active sites will remain roughly stable as work finishes on other sites.

In the 12 months to the end of June Barratt completed 13 202 homes, down 29% on the 18 588 completed last year.

Barratt will spend £300m on new land over the next 12 months mostly on land it had already contracted to buy, but said it would not have to write down any more of its land bank.

Redrow forecast full-year results at the lower end of analysts' estimates. The group said that over the last six months, sales prices and volumes had remained stable, with forward sales at the end of June of 1147 homes, down 4% from the same period last year.

Private customers now account for 52% of these reservations, compared to 41% a year ago, when the group was more reliant on social housing.

Redrow has restarted work on previously mothballed sites building more three and four bedroom houses than small flats.<

Shares in Redrow fell 0.7% to 211p in early trading, while shares in Barratt rose 1% to 156p. 

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