Homebuilder expects testing year

By JAMES ROSSITER
Updated:

 

BRITAIN's biggest retirement homes builder McCarthy & Stone poured cold water on any early recovery in the housing market today as it predicted another 'testing year ahead'.

Demand for McCarthy's new homes gives one of the best measures of the state of the secondhand market as buyers of its flats depend on selling their own homes first often via lengthy chains.

Today chairman Keith Lovelock said McCarthy started its new financial year at the start of September with forward reservations on 255 units compared with the 440 reservations the year before.

Trading in September and October has remained testing, he added, meaning August's quarter point in interest rates has failed to kickstart the housing market.

Last year profits fell in line with market expectations 14% to £127.4m in the face of 'one of the toughest market for years'. Completions fell 3.5% to 1,983 units.

McCarthy's margins will ease this year with average sales prices expected to stagnate. Confidence in the longer-term outlook is reflected in a 12% hike in the full-year dividend to 19.4p and share buybacks are on the cards.

McCarthy's view of the market may dampen any sudden share price recovery for other housebuilders with pricier homes to sell.

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