TELFORD Homes said yesterday that London’s “chronic” housing shortage means that it is selling homes quicker than it can build them, as it posted a 31 per cent surge in full-year profits.
The housebuilder, which builds primarily in London, targeting more affordable areas that are undergoing regeneration, sold 661 homes over the year, up from 515 in 2014.
As a result it is now 95 per cent sold for the year to 31 March 2016 taking total forward sales to over £550m, up from £341m as at 31 March 2014 and more than three times its annual revenue of £140.4m.
Pre-tax profits rose to £25.1m in the year to 31 March, beating market expectations, and the group said it was still on track to reach profits of £40m by 2018.
“We are experiencing an extremely strong marketplace where the demand for somewhere to live in London is still way in excess of the supply of new homes. You can see this at every sales launch” chief executive Jon Di-Stefano told City A.M.
He added that demand was such that there was no let-up in activity over the election, with almost two thirds of its Manhattan Plaza scheme near Canary Wharf sold in April.
Telford Homes will have 2,200 homes under construction by the end of 2015. But Di-Stefano warned that more needed to be done by the government do more to support the “supply-side” of the market if housebuilders are to deliver more homes.
The system needs reform but in reality small adjustments will make a big difference,” he said. “Certainly any improvement to the planning process, like putting more resources into planning departments and setting more defined time-limits for certain parts of the process, would help supply.”