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‘Severe’ downturn now less likely

‘Severe’ downturn now less likely

Category: Economy

Updated: 19/06/2009
First Published: 19/06/2009

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The UK's largest house builder and general construction business has said that the severe downturn scenarios which it had been planned for are now less likely to materialise.

At its annual general meeting, Taylor Wimpey said it was in a position to take advantage of increased stability in the UK housing market.

"Despite some regional variations, we have seen continued stability in the UK housing market since we reported our full year results on 30 April," it said.

"Whilst mortgage valuations and availability are still issues, there are signs that the situation is beginning to improve. We do, however, expect to see the normal seasonal slowdown over the summer months."

The business' order book has increased by 73 per cent since the end of 2008, with its order book currently standing at £971 million. House prices were now broadly flat, it said, and there is an expectation that the average selling prices will increase in the second half of the year.

However, the company warned that it would continue to adopt a guarded approach. "We have been encouraged by the ongoing stability in the UK housing market, but we remain cautious with regard to the prospects of the wider economy and in particular, the potential impact of rising unemployment," it said.

"We will retain our focus particularly on cost reduction until the profile of any recovery become clearer."

The firm's announcement comes just weeks after figures from Halifax and Nationwide showed a rise in house prices in May, while both buyers and estate agents have reported increasing enthusiasm in June.

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