U.K. homebuilders find increased profits through focus on single-family houses, building on land bought at lower cost after credit crunch

LOS ANGELES , January 16, 2012 () –

Homebuilders in the U.K. found higher profit margins last year as buyers bought more single-family homes than apartments, and companies concentrated on building on land bought at lower prices following the credit slump, Bloomberg reported Jan. 16.

The government is also making changes to boost homebuilding. It is offering investment and mortgage guarantees, and new homebuyers may be able to obtain mortgages with just 5% down-payments.

Longfield, England-based Bovis Homes Group Plc (BVS) predicted that its sales volumes, prices and profits would rise in 2012. CEO David Ritchie said the company is paying lower prices for land and paying subcontractors less, Bloomberg reported.

Bovis forecast that its 2012 operating margin will reach about 10%, compared with 7.3% a year earlier. It also said its forward sales of 568 homes rose 35% over a year earlier.

Publicly traded Bovis is the U.K.'s second-smallest homebuilder by market value, according to Bloomberg.

The primary source of this article is Bloomberg, New York, New York, on Jan. 16, 2012.

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