Berkeley sees house market stabilising

The group posted pre-tax profits of 110.3m in the year to April 30 - down by 8.4 per cent on a year earlier, although this was a smaller fall than most analysts had pencilled in.

Berkeley said while there were "attractive opportunities" opening up in the land market, property transactions were 40 per cent down on historic levels.

Berkeley said the market was being buoyed by demand from cash rich investors and overseas buyers taking advantage of the weak pound.

Customers snapping up properties for investment accounted for more than 50 per cent of underlying sales reservations, according to the group.

Sales prices were ahead of its targets set a year earlier and completions leapt 47 per cent higher to 2,201 in the year.

But a change in the type of properties sold saw average sale prices fall from 395,000 to 263,000 - largely accounting for a 12.4 per cent drop in group revenues to 615.3m.

The group said the industry was still digesting the implications of this week's Budget spending cuts and tax hikes.

It added there were still "residual imbalances from the financial downturn, which will continue to affect the wider economy and the sector".