Countryside Properties house completions and selling prices surge

Housebuilder and urban regeneration specialist Countryside Properties reported strong growth in its third quarter of its financial year, though its shares were caught up in renewed angst about the housing sector.

The FTSE 250 company, which perhaps suffers from having a similar name to estate agent Countywide, said it had completed 821 units in the 13 weeks from 1 April to 30 June, 41% more than the same time last year.

Average selling prices were up 16% at £404,000 and underlying sales price growth of 5%, with sales price growth in housebuilding held back somewhat due to the ongoing weakness in higher value homes.

Net reservation rates were up 16% at 0.88, while open sales outlets were up 19% to 44.

Countryside hailed a record private forward order book up 28% to £354.0m .

The Partnerships division continued saw completions increase 17% to 564 in the quarter, with 1,225 plots secured to take the number of plots under control to 18,146.

In the start of the fourth quarter the company we were awarded preferred bidder status to deliver 412 homes at Bilston Urban Village in Wolverhampton. We continue to see increased opportunity across all regions, with a growing bid pipeline.

The company said it continued to see robust demand for homes across both divisions and said it remained on track to deliver the growth trajectory set out earlier in the year.

In Partnerships, sales price growth remains strong and a "steady flow of new opportunities" was reported, supporting medium-term growth plans.

While ASPs in housebuilding was perhaps not as strong as hoped, management said the business will "continue to promote our mixed tenure approach and manage our product mix to ensure we maintain affordability and serve the areas of strongest demand".

Shares in Countryside were down 2.5% to 359.6p just before midday on Thursday.

Broker Peel Hunt downgraded the shares to 'add' from 'buy' but still sees some value with a target price of 395p.

"Sales price growth remains strong in Partnerships but has been more modest in Housebuilding where, as previously flagged, there is some weakness for higher value (£1m plus) homes. The land bank and bid pipeline remains healthy. Overall on target to meet full year expectations, so no changes to forecasts."