Bovis sees market lift but no return to boom years

Housebuilder Bovis Homes gave further confirmation of the property market rebound yesterday as it reported sales up by a quarter in 2009.

But the group cautioned that trading conditions will continue to be sluggish in 2010 compared with the boom years.

It also revealed that a buoyant social housing market was boosting overall 2009 price rises, with private homes hit by another slump in value last year – down 9 per cent at 165,500.

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Kent-headquartered Bovis said the pick-up in sales momentum continued in the second quarter, with 754 completions seen in the first half rising to 1,049 in the following six months.

Forward orders have soared by more than 50 per cent, with 643 homes on the 2010 order book at the end of December, up by 218 on a year ago.

Bovis said: "The group continues to expect trading conditions in 2010 to be subdued relative to historical levels, given ongoing economic uncertainty.

"Mortgage approval volumes are slowly rising, but mortgage providers continue to require record high levels of deposits, particularly from first-time buyers.

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"This all said, longer-term market demand and supply trends remain positive." Bovis said it made 1,527 private home completions in 2009. Reservations leapt by 82 per cent on the previous year, to 1,801.

Its moves to revive construction levels again after the market froze projects amid the financial crisis saw homes built leap to 690 in the final six months of 2009 from 221 in the first half.

Bovis said it had bought four sites in late 2009, with another 15 in the pipeline.

The news follows sales figures from Barratt Developments, which showed a 43 per cent hike in forward orders.

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Barratt also said it was investing in land opportunities after restarting buying and construction plans in mid-2009 – and predicted annual property price rises of around 8 per cent to 10 per cent by the end of June.

Analysts at Panmure Gordon said they believed Bovis had one of the strongest landbanks in the sector. "With a solid balance sheet, it is in a strong position to make attractive land acquisitions," they added.