A surge in house building outside of the capital helped Barratt Developments profits jump 8.8% to £321m in the six months to 31 December 2016.
In the house builder’s latest results it said that despite completions on homes falling to 7,180 from 7,626, it had hit record levels of completed homes outside London. Completions in London came in at 367 versus 842 in the same period the previous year, although Barratt expects sales in the capital to pick up in the second half of the year.
David Thomas, Barratt chief executive, said: “With a record forward order book, strong consumer demand and a positive lending backdrop, we remain confident in our outlook for the full year. Our confidence in the business going forward is reflected in the improved and extended capital return plan.”
The group said the fundamentals of the housing market remain robust, with strong demand supported by good mortgage availability and the Help to Buy scheme
According to the group it currently has a land bank of 77,000 plots and is continuing to explore methods of offsite construction and new ways of alleviating skills shortages.
It said: “On labour, we continue to see some pressure on skilled labour supply with shortages remaining location and trade specific. However, whilst labour costs are still rising, the rate of increase is moderating.
“We are also seeking to increase construction efficiency and reduce demand on labour through the use of alternative build options such as timber frames, large format block and light gauge steel frames.
“We are implementing a number of key initiatives in terms of improving efficiency.
“In addition to building around 1,300 homes during FY17 using timber frames we have completed trials of light gauge steel frames and large format block which give the business additional options with similar benefits as timber frame ensuring we are future proofing our business.
“We continue to trial various offsite technologies and innovative products and we are investing in research into smart technologies.”
