Bovis warns on mortgage drought
Updated on 10 July 2009
Bovis Homes has warned that the housing market continued to be constrained by a lack of mortgage availability but said that prices were showing "a degree of stability".
The housebuilder said it had seen an 11% year-on-year drop in completions in the six months to June 30, compared to the previous year.
Meanwhile, the average private house price was £160,400 in the first six months of the year, compared with £196,700 in the same period in 2008.
"The continuing lack of mortgage availability, particularly for first time buyers of newly built homes, has been challenging for the group during the first six months of 2009," Bovis said.
"House prices appear to be demonstrating a degree of stability at present, aided by the current low level of second hand homes being offered for sale across the housing market."
Bovis said it expected a policy of lower workloads would help it to end the year with cash that it intends to invest in new residential developments.
Bovis said its focus on driving volume "more assertively" meant that it had seen a 92% increase in net reservations for private homes in the six months since January 1, compared to the previous year.
The firm said it had met the challenge of lower mortgage availability through competitive pricing, first time buyer incentive schemes and an agreement with the Home and Communities Agency for additional sales to housing associations.
Bovis said cumulative sales for completion in 2009 were at 1,364 by June 30, from 1,482 in the same period last year.
Within this, private sales were at 1,086, up from 888 in 2008, but sales of social housing were significantly lower than last year, at 278 compared to 594.
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