Help to Buy boosts sales at housebuilder Persimmon

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Housebuilder Persimmon reported a 49 per cent leap in 2013 profits to £330m and cheered shareholders with the news it is bringing forward a £1.9bn payout.

The company, Britain’s largest housebuilder by market value, said it entered 2014 with a very strong forward order book and the early weeks of the spring selling season have been encouraging, with sales 22 per cent ahead of last year in the first eight weeks.

Persimmon has been boosted by Government schemes such as Help To Buy, which have freed up the mortgage market and lifted demand.

Persimmon’s finance director Mike Killoran said the group is looking forward to another year of good sales growth in 2014.

“Three things have supported the industry,” he said.

“Firstly there has been an improvement in risk appetite from mortgage lenders.

“We’ve seen a 30 per cent increase in mortgage approvals, which reflects that increase, particularly at the higher loan to value end.

“Secondly we’ve received a boost from the first phase of Help To Buy, which has captured the imagination of the homebuying public.

“Thirdly we’ve seen the return to the UK of more meaningful economic growth.”

Persimmon sold 11,528 homes in 2013, 16 per cent more than 2012 and the average selling price rose four per cent to £181,861 pounds.

The group said it expects a similar increase in sales volume in 2014 and it has the capacity to build 14,000-15,000 new homes a year.

Mr Killoran said the group saw very good growth in its Northern division.

“We built 4,500 new homes in the North last year, up 21 per cent on the previous year.

“The average selling price in the North is just over £150,000, which is down two per cent on the previous year as we have sold a greater number of smaller properties in the North,” he said.

Persimmon has launched a number of new developments in Easingwold, Hull, North Hykeham and Selby and plans to open a further seven this year including new developments in Hornsea, Harworth, York and Doncaster.

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