Barratt is bullish over homes sales

Published on Monday 23 January 2006 11:58

BARRATT, Britain's second-biggest housebuilder by market value, today said that confidence in the housebuying market was growing again, adding that it was on course to increase volumes for the year to end-June.

In an update ahead of its half-year results due on March 29, the Newcastle-based firm, which has developments such as the Artworks, Tradewinds and EH7 in Edinburgh, said the past three months in particular had seen sentiment turn positive again.

"There have been positive signs in the past three months that buyer confidence has improved and recent sales rates have been encouraging," said Barratt chief executive David Pretty.

"With the key spring season still ahead of us, it is clearly too early to be sure of market trends ... but if recent improvements are sustained, we are currently on target to increase volumes," he added.

Barratt also named former Abbey National finance director Mark Pain as its new group finance director to replace Colin Dearlove, who has decided to retire at the end of the current financial year.

Forward orders as of December 31 were down to around 700 million, against 803m a year earlier. But the company said that together with completions, this secured approximately 75 per cent of its full-year objective. There was a two per cent rise in legal completions to 7003 homes at an average selling price of 165,000, similar to last year.

Private completions were one per cent lower at 5569 at an increased selling price of around 180,000 and social housing completions increased by 14 per cent at a maintained selling price of around 106,000.

Barratt said recent sales had been "encouraging" and although below last year's record levels they remained above the group's historic norms.

"Despite testing market conditions we competed well in all our operational areas and, once again, expect to announce further growth in legal completions and an improvement in continuing pre-tax profit," said Mr Pretty.

The trading update echoes cautiously upbeat forecasts by other housebuilders such as Taylor Woodrow, Bovis and George Wimpey.