Housebuilder Berkeley has painted a more positive picture of the housing market as it lifted profit hopes for the full year.
The group, which focuses on London and the South East, reported a 20% rise in reservations, driven by a surge in the number of sites on offer, stable prices and strong demand in the capital.
The Surrey-based firm said it also believes house prices and transactions should remain stable in the coming year.
Berkeley saw revenues increase by 16% to £336.2 million in the six months to October 31, while pre-tax profits increased 18.5% to £61.1 million.
Managing director Rob Perrins said: “Overall, this strong performance provides the board with confidence that Berkeley can outperform management’s original expectations for the current year and is well placed for the following year.”
The upbeat performance follows figures from Nationwide on Wednesday which revealed a recent run of house price falls had wiped out most of the gains seen to property values during the past year.
Berkeley put its increase in sales reservations down to new planning consents on more than 30 sites last year, which has increased the number of sites the firm is selling by 30%. The company said high demand in London was partly driven by an increase in overseas customers looking for a home or investment in the city.
The increase in sales reservations has led to a 22% rise in forward order sales to £790.1 million, the company added. Berkeley acquired new land in the period, covering 13 new sites and 2,500 plots, including prime London locations in Westminster and on Hammersmith embankment.
Looking ahead, the company said its outlook was tied to the success of London in attracting investment, employment and retaining its status as a “world city”.
Chris Millington, analyst at brokers Numis Securities, said the results were strong and ahead of expectations. He said: “The main driver of the performance is an increase in sales outlets which has been supported by stable sales trends in London and the south east.”