Wimpey adds to property woe

TOP three housebuilder George Wimpey weighed in to the gloom gripping the housing market today, unveiling sliding sales figures and a warning on profits.

The healthy start to the year for reservations, when it last updated the market at the end of February, was 'shortlived', leaving sales for the first half of the year 17.5% down on 12 months ago.

Wimpey has 10% more sales outlets open than last year but this will not be enough to deal with a market where buyers are 'expected to remain cautious', said chief executive Peter Johnson in an update for the 26 weeks to 3 July.

Completions for the first half will be some 10% below last year, he warned, while 'cost pressure from materials suppliers' and greater use of incentives to try to stimulate sales will leave group profits 'well below the record achieved last year'.

The full-year outlook is little better, with a total UK order book - its US business is enjoying another bumper year - 7% lower by volume and 12% by value, reflecting more orders for cheaper social housing.

Forward orders for private homes are 19% lower by value and volume, one of the grimmest among the big 10 housebuilders.

The sales figures will put more pressure on the Bank of England to cut interest rates. They have been pegged at 4.75% since last August when the housing market began to come off the boil.

But Wimpey insisted no crash in property values was on the horizon, with average UK prices stable at £195,000, and expects better sales in the second half.

Wimpey's US division Morrison Homes, meanwhile, saw prices rise 11% and first-half completions 16% higher than last year.

See the latest news on the property market at www.thisismoney.co.uk/houseprices

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