viewVistry Group PLC

Bovis Homes says "Help to Buy" is boosting site visits


Bovis (LON:BVS) is set to paint a pretty picture of current prospects for shareholders at Thursday’s annual general meeting.

Trading in the 19 weeks to 10 May has been strong, with private net reservations up 26% year-on-year.

This has been driven by an 11% increase in the average number of active sales outlets to 91 (2012: 82), and a 14% improvement in the average private sales rate to 0.57 net reservations per site per week (2012: 0.50).

The number of visitors to the group's sites has increased by 29% in the year to date compared to the same period last year.

Sales prices achieved on reservations to date have been modestly above management's expectations, suggesting the government’s “Help to Buy” initiative is exerting some influence.

Some cynics have dubbed the initiative “Help to Sell” and Bovis’s outlook statement certainly suggests that house price inflation could be back with us, as it said it expects the average sales price in the half year results to be materially ahead of the prior year’s comparable period, though it says this is due to it selling more upmarket properties.

The housing profit margin is also expected to increase compared to the first half of 2012.

“Experience with Help to Buy in its early weeks has been encouraging with strong interest from home buyers and an increase in visitor numbers to the group's sales outlets,” Bovis said.

“The mortgage market continues to show signs of modest improvement. However, mortgage approval and residential transaction data reflect the ongoing challenging conditions facing the UK housing market. The group's growth strategy has been based on the assumption that these challenging market conditions will continue such that any market improvement will provide additional growth opportunities,” Bovis said.

Bovis shares were up 1.3% to 762.62 at the open.

Quick facts: Vistry Group PLC

Price: 860 GBX

Market: LSE
Market Cap: £1.87 billion

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