Issues like affordability and a marked drop-off in foreign speculators in the central London housing market are not presenting too much in the way of concerns for housebuilder Crest Nicholson (CRST) if its six-month update for the half-year to April is to be taken at face value.
Shares in the £1.4 billion cap are up 4.8% at 550p after management assured investors that the group remains on track to reach its stated target of £1 billion of revenues for the full year to 31st October 2016 and to continue growing the number of new homes it delivers.
Certainly, unit completions being up 7% at 1,206 for the period are encouraging, particularly in light of a 24% increase in average selling prices to £387,000. Total forward sales of £409m and 1,965 units are up by 22% and 10% respectively.
Going forward, Crest avers that the land market continues to offer good opportunities with the business maintaining a disciplined approach to acquisitions. To date, Crest has acquired 1,016 plots across nine sites and all for a gross development value of £416 million which more than replaces housing revenues for the six months to 30th April 2016.
Management maintains that attractive conditions in the market continue to underpin sales rates and revenue growth.
Although inflation in both sales prices and build cost have shown some signs of moderating, management argues that this will help to maintain affordability and support a stable housing market.