The new-build housing market is showing clear signs of recovery, according to an stock market announcement from Barratt today.
In an interim management statement for the 19-week period between 1 July and 8 November, the housebuilder said it had achieved its target reservation rates with prices ahead of budget.
It also said that the “stability in the UK housing market seen in the first half of the calendar year was continued into the current trading period”.
Visitor levels remained the same as last year, but the number of private sales has increased from an average of 197 per week to 204 per week, with cancellation rates dropping by a half.
The forward order book at 8 November stood at £846.6m (2008: £817.7m).
The housebuilder has 415 sites and said that, although the land markets remain “subdued”, it has identified a number of sites, largely on deferred terms.
However, Barratt warned the need to remain “cautious” due to the limited availability of mortgage finance”.
Mark Clare, chief executive of Barratt, said: “With the successful refinancing of the business now completed, we have substantially reduced debt levels and are in a strong position to buy land as opportunities emerge and to open new sites.
“Our net private reservation rates per site are running 34% ahead of last year.
“While trading conditions in the housing market have improved, activity levels will remain constrained until the availability of mortgage finance increases particularly at higher loan to value levels.”
The company completed a rights issue raising £720.5m in September, and now anticipates net debt at the end of the year being around £700m (2008: £1.4bn)
It is predicting total completions for 2010 to be around 12,000 homes, with a shift towards a higher proportion of houses.
