Redrow’s house sales fall 49%
Housebuilder, Redrow, reported a 58% fall in revenues in the second half of 2008 leaving the company facing a pre-tax loss of £46.2 million, compared with a profit of £35.8 million in the same period of 2007.
Falling sales and lower selling prices were to blame; during the second half of last year, the company said sales reservations across the UK were down an annual 49% to 853.
Price reductions made little impact, with Redrow reporting that its average selling price stood at £140,500 in the six months to the end of December, down from £162,700 in the first half of 2008.
Meanwhile, the group’s cancellation rate ran at 27% as prospective purchasers withdrew interest to nurse concerns about the recession and their employment prospects.
The builder says it has implemented a major cost reduction programme, having already reduced its workforce by 43%, to 740 employees, during the course of 2008.
Analysts agree that a shortage of mortgage funding continues to drag the UK property market down.
Last week, the Council of Mortgage Lenders reported that gross mortgage lending declined in January to an estimated £12.4 billion. The total is down 8% on December and 52% year-on-year.
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