Wimpey says sales solid for autumn

HOMEBUILDER Taylor Wimpey said trading in the busy autumn selling period had been stable and it is on track to meet margin targets.

The UK’s second-largest volume housebuilder by market value said its current order book for future completions stood at 6,265 homes, against 5,496 homes at the same point last year.

The group is targeting 10,000 sales for the year and said it is on track to deliver a double-digit percentage UK operating margin in 2012.

Taylor Wimpey, which sold its North American business earlier this year, reported an average private net reservation of 0.55 sales per outlet for the second half to date, compared with 0.47 in the same period last year.

“Although mortgage availability remains restricted, we have seen an ongoing incremental improvement since the half year results,” said the company in a statement.

This echoed comments from smaller peer Redrow last week, which said reservations and prices were stable while underlying demand is set to increase despite tough macro conditions weighing on the sector.

But the UK housing market continues to tread water and housebuilders are facing further uncertainty as public spending cuts and rising unemployment dents confidence. Taylor Wimpey posted first-half pretax profits of £28.9m earlier this year, against a loss of £2.3m in the same period last year. Meanwhile chief executive Pete Redfern said that a further escalation of Europe’s debt problems could spark a damaging UK banking crisis.

“The worse case scenario … is that a problem in Europe causes a UK banking problem, he said. While the underlying housing market is strong, if there was a withdrawal of banking finance obviously that would be negative.”