January 14, 2020 / 10:49 AM / 9 days ago

Homebuilder Taylor Wimpey posts 22% jump in order book

(Reuters) - Taylor Wimpey’s (TW.L) order book jumped 22% in 2019 to 2.18 billion pounds ($2.83 billion), the housebuilder said on Tuesday, aided by the government’s Help to Buy scheme, and said it saw positive signs in 2020.

FILE PHOTO: A construction worker walks on a roof as works on a Taylor Wimpey housing estate in Aylesbury, Britain, February 7, 2017. REUTERS/Eddie Keogh

“The environment is more positive at this point in the year than we have seen for the last couple of years. There is a bit of pent-up demand there. There is positive potential,” CEO Peter Redfern told Reuters.

Taylor Wimpey in its trading update reported a 5% rise in home completions in 2019 and a 2% rise in its overall average selling price to 269,000 pounds.

Shares in Taylor Wimpey, which is due to report its full results on Feb 26, were up 1.7% at 205 pence at 1016 GMT.

“Despite ongoing economic and political uncertainty, the housing market remained stable throughout 2019, albeit with more challenging conditions in London and the South East and at higher price points,” the company said.

Britain’s housing market has been pressured since the UK voted to leave the European Union in 2016, creating uncertainty over how, when and even if Brexit would occur.

The company said it expects in-line results for 2019 while for 2020 the focus would be on cost discipline.

Prime Minister Boris Johnson winning a clear majority last month was seen as a positive for the Brexit process as it paved the way for quicker decisions by lawmakers on departure-related matters.

“I think the environment is more relaxed and confident than 12 months ago. Mortgage availability and pricing remains very good, those are all positive indicators,” Redfern told Reuters.

Britain’s third-largest homebuilder after Barratt (BDEV.L) and Persimmon (PSN.L) had said in November it was still seeing demand for its houses despite the market uncertainty created by the Brexit process.

“The strong order book...does not feel as if earnings are going to suddenly soar, especially as price increases are flattening out,” said Russ Mould, investment director at AJ Bell.

(Taylor Wimpey share performance since Brexit vote: here)

Reporting by Muvija M and Samantha Machado in Bengaluru; editing by Uttaresh.V and Jason Neely

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