Building slump hits affordable homes

A statement from Taylor Wimpey issued today states it completed 1,709 affordable homes in 2009, down from 2,751 the previous year. The proportion of affordable homes also fell, from 20.5 per cent of the 13,394 completed in 2008, to 16.7 per cent of the 10,186 completed in 2009.

An update issued by Bovis Homes on Friday gives a similar picture. In 2009 the company legally completed 1,803 homes, down slightly on 1,817 the previous year, but only 15.3 per cent of those completed in 2009 were affordable, compared with 32.6 per cent in 2008.

The decreasing proportion of affordable homes has helped both builders drive up the average price of their homes. Taylor Wimpey’s rose from £153,000 to £160,000, and Bovis’ from £150,800 to £154,600.

For 2010, Taylor Wimpey has orders for 5,431 homes, a 28 per cent rise on the start of 2009. Of these, 3,048 are private.

In the statement it notes market conditions are stable, but says ‘the risks of further weakness in the wider economy and reduced mortgage availability remain’.

Bovis is also cautious about the year ahead. Its forward order book stands at 643 homes, up 218 on the previous year, but it says: ‘The group continues to expect trading conditions in 2010 to be relatively subdued relative to historic levels, given ongoing economic uncertainty.’

A annual general meeting statement issued by rival builder Bellway on Friday says it has had ‘a good start to the calendar year’ with 68 per cent of its 2009/10 sales target secured. But it adds: ‘We await the spring selling season with caution.’

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