Gleeson sees strong demand for affordable housing

The Sheffield-based group, which specialises in building on land that no-one else wants to buy and turning it into a desirable area, said annual pre-tax profits rose 12 per cent to £37m in the year to June 30.

The group’s chief executive Jolyon Harrison said: “We have a very strong market out there. A very large number of people living on council houses want to buy their own home.

“A Gleeson two-bed semi-detached house costs £100,000. With Help To Buy and a 35 year repayment mortgage you can buy a house for £54 a week.

“It’s a no-brainer for our customers. To rent a three-bedroom council house costs £80 a week.”

The average selling price rose from £122,700 to £125,200, which Mr Harrison said translated into a cost of £60 a week, which he said is “totally affordable”.

The firm is on track to double sales to 2,000 homes a year by 2022.

“We are absolutely on target,” said Mr Harrison.

“We are a bit ahead so we should reach our target easily.

“The South of England is certainly starting to struggle a bit. We are celebrating the North/ South divide. House prices in the North of England have hardly moved since the recession.”

In Yorkshire, the group has a number of new homes in development. The firm typically builds on waste or scrub land. New plots include 311 in Ferrybridge, 180 in Thorne, 164 in Bridlington, 145 in Dalton (Rotherham), 128 in Hull and 98 in Halifax.

Gleeson’s Strategic Land division completed 10 land sales over the year with the potential to deliver 1,970 residential plots. It has nine sites with planning consent or resolution to grant with the potential to deliver 2,089 plots. The division’s portfolio has 61 sites with the potential to deliver 22,838 plots.

The group has proposed a final dividend of 23p per share, resulting in an increase in the total dividend for the year of 33 per cent to 32p per share.

“We have got loads of cash and it belongs to shareholders,” said Mr Harrison.

Dermot Gleeson, chairman of MJ Gleeson, said: “Our twin track strategy – the development of low-cost homes for open market sale in the North of England and the Midlands and strategic land sales in the South – delivered another excellent year of increased volumes, profit and cash.”

The number of employees at the year end was 509, up from 405 the previous year.