Upswing at housebuilder

Housebuilder Persimmon reported a 12% increase in new sales reservations and predicted further margin growth coupled with an upswing in buyer interest.

In an interim management statement, the company said its order book including legal completions now stood at similar levels to last year at £1.24bn.

The sales order book at the beginning of the year was £565m, down from £638m in January 2010. “Since then sales rates have improved with the total value of new sales reservations taken in the year to date increasing by around 12%.”

Visitors to sites remained encouraging and cancellation rates continued at a low level of around 16%.

“We anticipate legally completing a similar number of new home sales during 2011 when compared with 2010, but with an increase in volume over the prior year in the second half. Whilst underlying prices remain stable we expect average selling prices to show improvement due to our strategy of mix change.”

The company said greater mortgage supply would be helpful, but “we are operating successfully at current levels of activity”.