Taylor Wimpey lifted by success of mortgage help schemes

HOUSEBUILDER Taylor Wimpey yesterday hailed a strong start to the year as reservations of new homes surge, boosted by Government schemes to lift the housing market.

The builder said more potential buyers were visiting its sites after the Government’s new Help to Buy scheme sent interest soaring.

Its total order book is up 18 per cent to £1.2bn over the same time in 2012, with prices and margins improving.

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Private reservations are up to 0.67 sales per outlet, from 0.62 per outlet a year earlier, amid a stable housing market. Taylor Wimpey added that its growth has been led by the buoyant London and South East markets.

Chancellor George Osborne’s new Help to Buy scheme – a £5.4bn package of loans and guarantees – was announced in last month’s Budget and lends buyers up to 20 per cent of the value of a new-build home, interest-free for five years.

Mortgage guarantees also aim to support another £130bn of high loan-to-value mortgages, by shifting the risk of default away from lenders on to the state.

Customer interest was up 15 per cent before the announcement, but Taylor Wimpey has since seen further “significant increases”.

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Chief executive Pete Redfern told shareholders ahead of the group’s annual meeting: “We are encouraged by the recent improvement in market conditions and welcome the Government’s approach.

“We do not forget, however, that the macro uncertainty which has characterised the last few years still remains and as such we retain a cautious approach, even given the more optimistic outlook.”

He added that Help to Buy’s success will depend on lenders offering cheaper mortgages.

The group echoed comments from other listed builders including York-based Persimmon, which recently said enquiries surged 30 per cent year-on-year after the Help to Buy announcement.

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The Government’s latest measures to boost the housing market are on top of earlier schemes such as First Buy and New Buy, which have helped listed housebuilders make a strong recovery since the financial crisis.