Orders for new houses lifts Persimmon’s outlook

More positive news for housebuilders and residential investors alike.  A key thing to also remember is the north south divide.  In the years to come only the most profitable sites will be built out (values highest in London & the South East) and in the areas with the greatest demand (London & the South East again) – this means IMHO London (already recovering) and the South East will vastly outperform regional locations.

“Persimmon today sounded a note of cautious optimism after selling more homes than expected this year amid signs that the fall in house prices is easing.

The house-builder said cancellations, where potential buyers walk away from their deposit rather than purchase a new-build home, hit a record low of 16% between April and June, boosting hopes that conditions in the market are set to pick up further.

Yesterday, analysts revised up their outlook for the housing market.

Economists at Royal Bank of Scotland now expect the peak to trough fall in house prices to be 30%, rather than 35%. Prices have already fallen by more than 20% since the market peaked in Autumn 2007.

The builder said that the number of sales completed in May and June were ‘consistently ahead of the same period of 2008.’ It has sold more than 4,000 homes so far in 2009. Forward sales revenue for the second half of this year has also jumped to £700m, up from £650m at the same time last year.” (Property Week) http://www.propertyweek.com/story.asp?sectioncode=297&storycode=3144354

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