Taylor Wimpey Cautious Of Future Spending Reviews

28th Jun 2010 07:23

By Anita Likus Of DOW JONES NEWSWIRES LONDON (Dow Jones)--U.K. house builder Taylor Wimpey PLC (TW.LN) on Monday said it will increase sales and is confident house prices will continue to rise but cautioned that future spending reviews and a shortage of land for sale could hurt business. The company sold 83% of expected houses for the full year, with reported private sales in the year to date broadly in line with those last year, at an average of 0.58 sales per site per week. With historically low cancellations at a year to date average of 16%, the company will run its business cautiously in the short term, it said. "Although the recent U.K. Budget did not contain new measures that we would expect to have a detrimental impact on the housing market, we remain concerned regarding future spending reviews that could impact on housing initiatives, particularly the level of Social Housing Grant," the company said in a trading update ahead of its first-half results. Taylor Wimpey said it will continue to run its business cautiously, buying land selectively and with an ongoing focus on costs and cash in the short term. In the medium term, it remains concerned that the shortage of consented land will artificially constrain the recovery in industry volumes, which will be exacerbated by the impact and timing of changes in planning policy following the general election. Taylor Wimpey added, however that the it continues to perform in line with internal expectations in a gradually improving, but still uncertain, trading environment and that the shortfall of new build housing and the strong levels of demand will continue to underpin pricing in the housing market. It expects to complete around 4,650 homes in the first half of the year at an average selling price of some GBP167,000. -By Anita Likus, Dow Jones Newswires; +44 20 7842 9407; [email protected] (END) Dow Jones Newswires June 28, 2010 02:23 ET (06:23 GMT)