It seems rumours of the demise of the London housing market were greatly exaggerated, after Berkeley Group, one of the capital's biggest housebuilders, reported a 53 per cent jump in pre-tax profits.
The housebuilder said pre-tax profits rose 53 per cent to £812.4m in the year to the end of April, from £530.9m the year before.
Revenues rose 33 per cent to £2.7bn, while net cash grew to £285.5m, up from £107.4m last year.
But there were some signs of shakiness: the company's forward sales fell to £2.7bn, 15.7 per cent down on the same time last year, while dividend per share fell 2.6 per cent to 185p.
Still - it said it was on target to deliver £3bn of pre-tax profits between May 2016 and May 2021.
Shares in the company rose three per cent to 3,325p in early trading - despite analysts having hoped for an even bigger, 58 per cent, rise in profits.
Why it's interesting
In the aftermath of the financial crisis, London's housing market burgeoned. However, since last year, when the EU referendum result came just months after punishing new rules around stamp duty on buy to let homes were introduced, that stellar growth has slowed, causing housebuilders to wring their hands.
Back in March Berkeley Group declared the slowdown was over, saying the market in the South East had "stabilised", and today's figures back that up.
But question marks remain over the growth of the capital's housing market. Figures published last month by Your Move showed prices in the capital had fallen 0.1 per cent between March and April, while rival housebuilder Crest Nicholson has warned uncertainty after the General Election may put buyers off moving into the market in the short term.
Even Berkeley Group admitted today that confusion following the EU referendum wasn't going away.
"Uncertainty over Brexit remains and this, coupled with the impact of high SDLT [stamp duty] and multiple demands from the planning system in London, mean that supply in our capital will remain constrained and not reach the levels required," said Rob Perrins, the company's chief executive.
What Berkeley Group said
Chairman Tony Pidgley added:
The housing market has stabilised in London and the South East but, while Berkeley is in excellent shape with further additions to our unrivalled land bank in the period, it is an inescapable fact that we are facing a number of headwinds and a period of prolonged uncertainty.
Brexit and wider global macro instability impact both confidence and sentiment and will result in constrained investment levels. At the same time, the headwinds from changes in recent years to SDLT and mortgage interest deductibility, coupled with the planning environment's increasing demands from the combination of Affordable Housing, CIL, Section 106 obligations and review mechanisms, are resulting in reduced levels of new housing starts in London.
A recovery, but on shaky ground.