House builder Taylor Wimpey states business as usual

The FTSE 100 firm saw trading ‘in line with normal seasonal patterns’ as profits stepped up 12 per cent to £266.6million for the six months to July.

Housebuilder Taylor Wimpey has stated it’s business as usual after it boosted profits and shrugged off uncertainty following the UK’s referendum on the EU.

Revenues picked up 9 per cent to £1.5billion over the period after it built more than 6,000 homes in the first half of the year.

Taylor Wimpey said profits rose by 12 per cent in the six months to July

At the same time average selling prices increased 5.8 per cent to £238,000, up from £225,000 over the same period in 2015. It also had a strong order book of 8,683 homes worth £2.2billion.

And according to chief executive Pete Redfern there has been no major fallout from the vote to leave the European Union yet.

He said: ‘We are monitoring customer confidence closely across a number of metrics, including appointment bookings, and these continue to be solid.

‘Whilst it is still too early to assess what the longer term impact from the referendum result on the housing market may be, we are encouraged by the first month’s trading and by continued competitive lending from the mortgage providers as well as the positive commentary from Government and policymakers.’

Anthony Codling, analyst at Jefferies, said it was a ‘confident statement’.

He added: ‘Given the opportunity for all companies with UK exposure to make ‘brexcuses’ about current trading and/or it still being ‘too early’ to assess the impact of Brexit, we were pleasantly surprised to learn that so far, Brexit is having the same impact it was having before the referendum; not a lot.’

Taylor Wimpey’s statement also helped lift rival builders, with Barratt Developments up 32.1p at 422p, Persimmon rising 100p to 1,688p and Berkeley pushing 153p higher at 2,696p.

It was a similar story on the FTSE 250, where Crest Nicholson jumped 44.2p at 445.1p, while Bellway rose 134.0p at 2075p and Bovis was up 34p at 797p.

Housing stocks took a battering on London’s top flight index immediately after the Brexit vote.

Shares in Taylor Wimpey are still 24 per cent lower than their closing price on June 23.

But while Taylor’s trading remains robust, the company said it had seen some slowing in the London property market.
It added: ‘Whilst we saw a small increase in the average cancellation rate immediately following the referendum, this remained low compared to long-term historic norms and is now back in line with recent low levels.

‘The markets in all of our core regional geographies, which are the primary drivers of our business, continue to trade positively.

‘Whilst the wider London market remains robust and in line with the rest of the UK, the central London market has continued to slow, particularly at the upper end of the market.’

Latih Khalaf, senior analyst at Hargreaves Lansdown, said Taylor Wimpey ‘isn’t blinking in the face of Brexit’.
He added: ‘Confidence is a key part of the housing market, and so far this seems to be holding up well in the weeks following the EU vote.

‘The long-term economic outlook of the Brexit decision is still unclear, and any rise in unemployment would be negative for the UK housing market.

‘However, the UK still has a housing shortage, ultra-low interest rates, and Government initiatives like Help to Buy, which should all put upward pressure on property prices, and provide sustenance for companies like Taylor Wimpey.’

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Written by: Houseladder