Taylor Wimpey 'focused on raising prices' in improving housing market

Housebuilder Taylor Wimpey today said it was focused on raising prices after selling all the homes earmarked for retail during 2009.

The firm said market conditions were "significantly better" from July 1 to date than last year, with cancellation rates at 16%, against 46% in 2008.

Sale prices were 9% higher than the £163,000 average seen in the first half, while Taylor Wimpey added that its US business had shown stability.

It said on UK trading: "We are now fully sold for 2009 and our sales focus remains on achieving price increases as we build our 2010 order book."

In response to the improved market conditions, Taylor Wimpey has steadily increased its build rates in the UK.

It has opened 22 outlets in the second half to date and now operates 317 sites, with further openings planned for the rest of the year.

The group said the continuation of improved market conditions into the autumn selling season had been reassuring, but warned further progress hinged on improvements in mortgage availability and the wider economy.

It added: "Our operational focus remains on build cost reduction and achieving sales price increases as we build our order book for 2010."

Shares surged 8% to 39.9p in the wake of today's upbeat report.

The group spent much of the last year in a battle for survival - leaving its shares at just over 3p at one point - before a refinancing deal in April gave it bank facilities totalling £2.47 billion. A £510 million cash call on shareholders also helped as debt is expected to fall to below £800 million by the end of the year.

Taylor Wimpey, which also has operations in Spain, was created from the merger of Taylor Woodrow and George Wimpey in 2007. It recently signalled the end of its Bryant Homes and George Wimpey brands, with all new outlets in the UK to be branded as Taylor Wimpey.

Rival firm Redrow also gave a positive assessment of housing market conditions in a trading statement issued ahead of its AGM in Flintshire.

The company said total net private reservations in the first 18 weeks of its financial year were 47% ahead of a year earlier, with cancellation rates returning to historic norms.

Achieved prices were slightly ahead of its expectations, with private house reservations averaging £149,000.

It is currently selling from 74 developments and remains on track to launch a number of new outlets featuring its New Heritage Collection in the early months of 2010.