6th Nov 2013 08:39
LONDON (Alliance News) - Housebuilder Persimmon PLC Wednesday said sales activity has improved further since its half-year results, with visitors levels up 20% on last year boosted by the UK government's mortgaging financing scheme.
In August, the company posted a 38% increase in pretax profit in the half year ended June 30, as weekly private-sale reservation rates rose 30% compared with 2012 following the introduction of the Help To Buy scheme in April.
Help-to-Buy is a programme whereby the government either provides part of the mortgage loan to buyers of new-build homes or guarantees part of the borrower's mortgage, allowing them to get a bank loan with a lower deposit than would be normally required.
Persimmon says interest has not waned in the three months ended September 30, and cancellation rates have continued to run at historically low levels at around 16% compared with 20% in 2012.
The company said it is now fully sold up for the current year with GBP650 million in forward sales reserved beyond 2013, compared with GBP462 million a year earlier - an increase of 41%.
In response to the improvement in sales, the company said it has increased its build rates across the country.
As part of a strategy to open 85 new sites identified for the second half of the year, Persimmon has now opened 65 of these with "encouraging reservation rates". It said this would support further expansion in the future as it converts reservations into legal completions.
Persimmon said selling prices in all its regional markets remain firm. Earlier this year, it said the average selling price of new homes it sold was GBP179,199.
Persimmon said operating profits during the period continue to improve with "tight control exercised over build costs and overheads".
Persimmon shares were up 5.00 pence at 1,220.00p early Wednesday.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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