UK housebuilders' profit jumps shore confidence in market recovery

Thursday 04 July 2013 18.45
Company results signal a recovery in UK construction industry
Company results signal a recovery in UK construction industry

UK builders Taylor Wimpey, Galliford Try and Redrow said they would meet or beat full-year expectations, shoring up confidence that the UK housing market is firmly recovering.

Taylor Wimpey said today that it is likely to meet its full year expectations after improved buyer sentiment helped it to trade at the upper end of forecasts in the first half.

It also predicted a rise in its UK operating profit margin to over 13% from 11.2% the same time last year.

In separate statements, Galliford Try said it would post record full year profits, in line with current market consensus, while Redrow posted a 26% rise in full year revenue and said profit would top forecasts.

UK housebuilders - including Persimmon and Barratt Developments - have seen their share prices and sales surge in recent months after the government announced plans to support struggling housebuyers with billion of pounds in loans. UK banks reported a sharp rise in mortgage lending in the second quarter.

Taylor Wimpey said it completed 5,192 homes over the six months to end-June, with the average selling price rising to £187,000 sterling from £176,000 in the prior year.

''During the first half of 2013, we have been operating in a UK housing market that has shown measurable improvement for the first time since the downturn of 2007/2008," the company's cief executive Pete Redfern said.