Barratt Developments, a house building company, has said the recovery in the housing market is spreading outside of London. We answer five questions on Barratt’s comments.
What exactly has Barratt’s said?
In a release announcing the company’s final results for the year ended 30 June 2013, chief executive Mark Clare said:
“We are seeing the housing market recovery starting to spread beyond London and the South East.”
What is the company attributing this to?
An improvement in the mortgage market. Barratt’s chairman Bob Lawson said:
“Significant progress has been made on the availability of finance for customers and the mortgage providers’ capacity to lend has slowly improved.”
“This has been accelerated by a series of Government mortgage initiatives – FirstBuy, NewBuy and Help to Buy,” he added.
Has the recovering market resulted in them seeing a rise in profit?
Yes, the group reported pre-tax profits for the year to the end of June of £104.8m, up from £100m the previous year.
Its average selling price rose to £194,800 up 7.9 per cent from the previous year’s figure of £180,500.
The group has also cut its debt to £25.9m from £167.7m at the end of June 2012.
Does this mean it has plans to build many more houses in the country?
The group said they plan to complete about 45,000 new homes over the next three years.
Has any one else echoed these reports of a spreading housing recovery?
Royal Institution of Chartered Surveyors (Rics) said earlier in the week that there was a pick-up in the market in areas beyond London and the South East of England.
According to the institution the number of homes for sale across the UK increased in August but still did not match demand.
However, The Council of Mortgage Lenders said the pace of housing activity in the country was only “moderate,” according to the BBC.
“The UK property market is actually a complex and dynamic patchwork of regional and local conditions in different locations across the UK,” the lenders’ group told its website.
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