Bovis remain cautious for year ahead as house completions rise

BOVIS Homes Group, one of Britain's biggest housebuilders, issued a cautious statement yesterday about its improved completion of private homes, saying there was little sign of recovery outside of London.

Wrapping up a generally positive week for the sector, Bovis reported a quarter rise in completed private homes, standing at 1,527 for the year ending December 2009.

Despite a "strong balance sheet", the firm was "cautious" about the year ahead.

Finance director Neil Cooper, who will be leaving the company in early May, said: "London is doing much better and the further away from London you get the worst the sentiment gets.

"In the north and the Midlands (their] pricing expectations are flat to down rather than up, clearly south-east is better. We are not in London so we don't have exposure to that upside."

Bovis, which mainly trades in England and south Wales, did not disclose its margins in its trading update, but said its average sale price at 154,600 was 2.5 per cent higher than 2008.

However, the average sale price of the group's private homes in 2009 was 165,500 versus 181,000 the year before.

"We have seen a marginal improvement in pricing, but we have got to be quite cautious about being aggressive with price increases as the market is still quite fragile," said chief executive, David Ritchie.

He added that although Bovis would focus on expanding in the south and south-west of England, there were areas in the Midlands and the north that are ripe for residential development at today's prices.

"We do expect 2010 to remain challenging, but we are well placed to take opportunities in the market," said Ritchie.

Housebuilding rivals, Miller Group, Barratt Developments and Persimmon have all reported surges in forward sales in the past two weeks.

Britain's biggest construction and infrastructure group, Balfour Beatty, unveiled a 13.7 billion order book yesterday, pointing to resilient recessionary trading.