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Barratt sees best market in five years driving profits
May 9, 2013 / 6:37 AM / in 4 years

Barratt sees best market in five years driving profits

* Sees significant improvement in FY operating profit

* Reservations up 18 pct after government scheme launch

* Forward sales rise to over 1 billion pounds

LONDON, May 9 (Reuters) - British housebuilder Barratt Developments said market conditions were the best it had seen for five years and that it expects to post a significant improvement in annual profits.

The company, Britain’s largest housebuilder by market value, on Thursday said net private reservations per week per active site rose 18 percent to 0.72 compared to the prior year after the government announced plans to help struggling house buyers on March 20.

This contributed to an overall 9.7 percent increase in net private reservations from Jan. 1 to May 5, it said. Finance minister George Osborne has pledged to provide and guarantee billions of pounds in loans to home buyers in a bid to boost home ownership and construction.

“Help to Buy has seen a strong start and we are investing in land and bringing it through planning to meet increasing consumer demand,” chief executive Mark Clare said in a statement.

Many British house buyers have found it tough to stump up the large deposits needed to buy homes and the financial crisis has made banks reluctant to hand out mortgages. Barratt said the present backdrop, in terms of consumer demand and mortgage supply, was the most positive it had seen for five years.

The company said its private forward sales, excluding joint ventures, at May 5 was 28.5 percent up on the same point last year at 1.01 billion pounds ($1.57 billion) and it reduced net debt guidance to 100 million pounds for the end of June.

Shares in Barratt, which have risen 42 percent over the last three months, closed at 320.5 pence on Wednesday valuing the company at 3.13 billion pounds.

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