Berkeley defies the downturn as housebuilder's profits surge 64%

Mortgage indemnity plan will help many get on to the property ladder, says Tony Pidgley

Click to follow
The Independent Online

One of Britain's most influential housebuilders has hailed government plans to guarantee loans for first-time buyers and shake up the planning system as "the most significant changes to the housing industry for a generation".

Tony Pidgley, the veteran chairman of Berkeley Homes, whose personal story has become the stuff of legend, said the mortgage indemnity scheme to protect banks against losses on mortgages would "enable many people who aspire to own their own property to take the first steps on the housing ladder".

He was speaking as the company posted a 64 per cent surge in pre-tax profits to £101m for the six months to 31 October on revenues up 20 per cent at £405m.

Mr Pidgley said many people otherwise able to afford homes were prevented from buying because of lenders' demands for huge deposits. "Of course there have to be checks and balances in lending but I think the majority of people are responsible. There are people who can afford to enter the housing market but who in my view are prevented from doing so by these deposits," he told The Independent.

The Government's "localism agenda" and attempts to streamline the planning process have provoked controversy, with critics claiming that developers would be able to brush aside objections to plans that would involve concreting over parts of the countryside.

But Mr Pidgley said developers would have to "work with local communities" and gain their consent for the building of desperately needed new homes.

"Of course you're never going to get the support of everyone, but we find that by engaging with people and listening to them they are willing to work with you. Look, we need new homes. We desperately need new homes. I want to put on record that I support what the Government is doing with this. I find it refreshing and I hope they carry it through. I think they will carry it through."

Mr Pidgley, whose company sold 1,506 homes between May and October, an increase of a fifth over the same period last year, said he hoped the reforms would eliminate delays of up to a year between the granting of planning permission and the start of development. These delays were caused by "red tape, regulation and bureaucracy", he said.

Mr Pidgely has been described by the leading trade magazine Building as "Britain's most influential housebuilder" and has garnered a string of accolades, most recently from Management Today and Birmingham City Business School, which crowned Berkeley as Britain's Most Admired Company.

A Barnado's boy, Mr Pidgley was adopted at the age of four by travellers and spent part of his formative years living in a disused railway carriage. He was barely able to read and write when he left school at 15, but that proved no impediment to a spectacular business career during which he set up a haulage business which had a fleet of more than 40 lorries by the time he sold it to Crest Nicholson five years later.

He went on to set up Berkeley, which he floated in the mid-80s, and has seen off two attempts to wrest it from him. One was from his own son, the other by the financier Guy Hands, best known for his disastrous acquisition of EMI.

Yesterday's results gave a picture of a company in rude health. Berkeley expects to exceed the City's full-year forecasts, in part because of the sale of a postgraduate accommodation scheme for Imperial College.

The group focuses on big-ticket regeneration projects in London and the South-east and has 10,000 plots of land ready for long-term development.