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August 23, 2010    

Bovis: Consumers hit by spending cuts and tax hikes

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by Kay Murchie
Bovis: Consumers hit by spending cuts and tax hikes

Housebuilder Bovis Homes has today claimed the coalition Government’s spending cuts and tax hikes have dented consumer confidence.

Its claim comes as the company reported a pre-tax profit of £3.5 million in the first half of 2010, compared with a loss of £8.6 million for the same period last year,

Meanwhile, it added it planned to pay a full-year dividend for the first time since 2007.

The Kent-based company said it sold 803 homes in the period, compared with 754 a year earlier.

However, it echoed other housing market commentators by saying there has been a shift in the market since the emergency budget in June.

Many experts believe the major spending cuts announced by the Government are likely to knock consumer confidence.

Furthermore, the market is expected to remain subdued for the rest of the year, as a result of supply outstripping demand and the ongoing lack of mortgage availability.

Mortgage approvals are currently running at about half the level of their peak in autumn 2007.

However, despite the downbeat prospects, Bovis said it had £79 million net cash in hand at the end of June and was “positive” about future expansion and a pick-up in profits.

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