Builders buoyant despite house price blip

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The Independent Online
Signs that housebuyers may be resisting higher prices has failed to dampen optimism as three of the building industry's biggest groups reported record profits.

A survey published today by the Royal Institution of Chartered Surveyors shows a fall in the number of surveyors seeing house price increases, with only London and the West Midlands reporting rises in the three months to the end of August.

But the findings are at odds with the view of Beazer, the UK's third- biggest housebuilder, which revealed yesterday that it believed it could nearly double its current output of houses.

Dennis Webb, chief executive, said there was still plenty of "headroom" for the housebuilding industry, with the 155,000 units built in the last year still well short of the 180,000 to 185,000 expected to be required to accommodate new households and the replacement of old housing stock. "We believe public demand can withstand some continuing interest rate rises, if this proves to be necessary."

Beazer's pre-tax profits jumped 34 per cent higher to pounds 62.2m in the year to June.

Ibstock, one of the UK's two largest brick groups, said there was continued optimism about the market for the rest of the year. Boosted by the acquisition of the Steetley brick operation from Redland last year, pre-tax profits jumped from pounds 2.41m to pounds 8.45m in the latest half-year.

Elsewhere, Rugby, the country's third-ranking cement producer, said the housing and commercial markets remained "reasonably strong".

Pre-tax profits before exceptional items rose 12 per cent to pounds 32.6m in the six months to June, while the interim dividend is being raised 10 per cent to 1.65p.