More good news for the housing market as reservations surge at Barratt

Further evidence of a stronger housing market emerged today after Barratt Developments said reservations since July were up a third on a year ago.

The company also reported a forward order book worth £846.6million at the start of November, against £817.7million for the same time last year.

Despite the improvement in trading conditions, Barratt predicted activity levels will remain constrained until the availability of mortgage finance increases, particularly at higher loan to value levels.

Step by step: The housing market is showing promising signs of recovery

Step by step: The housing market is showing promising signs of recovery

Barratt's trading update was in line with comments yesterday from Charles Church owner Persimmon, which reported a healthy order book but highlighted 'significant concerns' about mortgage finance and high unemployment.

In light of the tight mortgage situation, Barratt said it stuck by its forecast made in September for 12,000 completions in the year to June.

A shift in the product mix towards a higher proportion of houses means that Barratt's average selling price should lift by between 8 per cent and 10 per cent.

Private reservation rates per site were ahead 34 per cent on a year earlier.

Panmure Gordon stockbrokers said Barratt had made a solid start to its financial year, but added it still expected the company to report an underlying loss of £78.2million in the year to June 30.

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