Efficiency the key as housebuilder gets back in profit

The Doncaster-based company, which operates across Yorkshire and the East Midlands, posted a pre-tax profit of £1.8m for 2010/2011 after making a loss of £1.5m the previous year.

Turnover rose from £40.9m to £43.1m after the company sold 305 new homes with an average selling price of £150,025. It also invested in shared equity to help first-time buyers on the housing ladder.

Gross margin grew to 14.6 per cent, up from to 8.6 per cent the previous year.

Strata, which employs 218 staff in total, specialises in building two-to-four-bedroom homes for first and second-time buyers aged between 20 and 35.

Irving Weaver, chairman of Strata Homes, said: “It has been a very successful year for Strata Homes. We have introduced a more personalised response to our potential customers, helping them to secure mortgages.”

He added: “We have become more efficient and been able to buy our materials cheaper, and our sub-contractors are also cheaper because everyone has had to tighten their belts. Our output has increased and there has also been a small price recovery since the end of 2008. We have redesigned some of our schemes to suit market conditions.”

The firm currently has control of 2,926 plots with a further 1,526 under negotiation, subject to planning. It expects to sell more than 400 homes in 2011.

Mr Weaver added: “Looking ahead to the next 12 months, we are confident that Strata will continue to strengthen its position in the market despite a number of challenges. These include a shortage of available mortgages with an appropriate loan to value for first-time buyers; the new Localism Bill, which adds further uncertainty to an already protracted planning system; rising unemployment from a prolonged downturn; and tax increases.”

Strata was founded in 1919 by Mr Weaver’s grandfather, Oscar, who was a bricklayer.

The company sold 280 homes in 2009 following the financial crisis, compared with 478 in 2008, and made around 50 redundancies. In 2009, Mr Weaver sold the affordable housing division, Strata Construction, to construction giant Balfour Beatty, for £10.3m.