Redrow warns lower home sales on challenging market
Housebuilder Redrow reported lower six-month underlying profit on Thursday and warned of lower than expected annual home completion, as it sees more challenging market conditions.
New houses in flood areas "uninsurable"Redrow said profit before tax fell to 35.8 million pounds in the six months to end-December, versus 54.7 million a year ago, as turnover fell to 353.1 million pounds from 387.7 million and legal completion decreased by 4.7 percent to 2,111.
"Visitor levels have increased in the new year but the markets in which we are operating are clearly challenging," it said in a statement.
"Our overall expectation remains that 2008 will present a more difficult trading environment than the industry has experienced for many years with lower levels of confidence in the housing market."
It said presold homes fell 10 percent to 1,694 units, as sales were affected by the tightening in mortgage availability, keeping prospective buyers at bay.
Redrow warned that legal completion in the current financial year would be 3 percent lower than its previous forecast and would show a 10 percent annual fall as a result of more challenging housing market conditions.
(Reporting by Miyoung Kim; Editing by David Cowell)
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