Record order book at Barratt

HOUSEBUILDER Barratt confirmed the robust state of the housebuilding market early today with confirmation that it is 'well on target' to achieve expected targets for the year.

The continued house price boom and a nationwide shortage of new properties continues to fuel investors' enthusiasm for housebuilders.

Barratt said that forward advance orders are more than living up to expectations and currently standing at record levels. The company said it believed it is also very well placed for the future with strong sales across the country.

In a passing comment on the Bank of England‘s recent base rate rises, the company said it believed that interest rate increases will help to deliver a sustainable market.

The company is touring the City making presentations to investors and analysts. It is due to give another trading update in another couple of months before publishing results in September.

Enthusiasm for housebuilders has been growing in the past few weeks, thanks in part to the house price boom but also reflecting strong results from companies across the sector.

Two weeks ago investment bank UBS raised its stance on housebuilders Crest Nicholson, Westbury and Bellway to 'buy' from 'neutral'.

Analysts at the bank said they were retaining a 405p a share price target on Crest Nicholson, a 565p target on Westbury and a 890p target on Bellway.

The housebuilders have made a concerted effort to quash bearish comments from the City about the impact.

Paul Pedley, chief executive of top ten housebuilder Redrow, says claims of a collapse in London ouse prices are mistaken.

Redow and Barratt are not alone - Wimpey, Persimmon, and Bovis have all renewed their faith that the fundamentals are in place for the housing boom to continue and talk of moderation in price increases rather than absolute falls.