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Redrow statement on YTD

House builder Redrow’s statement on the year to date (18 weeks) was as encouraging as the rest of the news coming out of the residential property sector at the moment.

Sales are stable, prices have been better than expected, and reservations are 47% up on last year (obviously this is against a terrible comparative). Cancellations as a result of surveyors valuing properties lower than the sales price continue to be a problem: the surveyors do not seem as optimistic about the market as the developers.

Redrow intends to use the proceeds of the current rights issue to buy more land, which will make it somewhat more risky given the unpredictability of the housing market (residential property is still expensive compared to earnings by historical standards).

Like other residential property developers, Redrow is trying to improve its sales mix, which a shift to houses from flats.

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