HOUSEBUILDER Redrow has posted better than expected pre-tax profits, thanks to a 14 per cent rise in revenues, but warned of a tough outlook for the property market.
The Wales-based company posted a pre-tax profit of £25.3m in the 12 months to the end of June, compared with £700,000 the year before, beating a consensus of around £20m.
Chairman and founder Steve Morgan, who returned to the group around two years ago at the bottom of the property crash, said the improvements were boosted by strong sales of its New Heritage Collection, a range of two- to four-bedroom houses launched in February 2010.
The average selling price of these homes, which made up 41 per cent of total sales in the second half of the year, increased 11 per cent to £201,000.
The company sealed more legal completions in 2011, with the number improving to 2,626 from 2,587.
But Morgan, who also owns Premier League football club Wolverhampton Wanderers, warned that the outlook for the industry remained tough due to the lack of mortgages, particularly for first time buyers.
“With five new jobs being created for every new home built, it is strongly in our country’s interest to resolve the mortgage issue, which would once again enable the housing industry to provide urgently needed new homes and a major stimulus to the economy,” he said in a statement.
The group also sold its Scottish operation during the year in order to focus on the south east England market. Redrow established a London region where 342 plots have been secured.