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UPDATE 1-Taylor Wimpey says positive trends continue

Published 04/21/2011, 06:38 AM
Updated 04/21/2011, 06:40 AM
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* Order book 5,681 homes vs 4,684, improvement in margins

* Sees relatively flat housing market in 2011

* Shares rise 1.5 percent

(Adds details)

LONDON, April 21 (Reuters) - British housebuilder Taylor Wimpey said sales and prices continued to reassure, echoing comments from peers, adding that the sale of its North American business would drive land buys in the UK.

Britain's second biggest housebuilder by value described market conditions in the UK as "resilient", with a forecast of a flat market in 2011, while it reported an order book at 5,681 homes compared with 4,684 at the end of last year.

Rival builder Persimmon, which put out an interim management statement earlier on Thursday, said sales had risen 12 percent so far this year, offering futher reassurance to the market after transactions fell in the second half of 2010.

Taylor Wimpey recently sold its North American business to a group of private equity firms for $955 million in a move that will help it slash debt, standing at 817 million pounds at the end of March, and focus on its UK business.

Taylor Wimpey, which currently operates from 300 outlets, said it remains on track to hit its target of a double-digit operating margin in the UK next year and has had a further improvement in the margin on sales in its order book.

Housebuilders have reported a more robust selling environment so far, supported by new retail data for March.

But poor mortgage availability continues to drag on housing transactions, particularly the first-time buyer market.

Gross lending for home purchases rose 21 percent in March from February and the industry body said it expected mortgage credit availability to improve this quarter. But on the year, mortgage lending fell 2 percent.

Taylor Wimpey said it has made good progress in signing up further lenders to its insurance-backed mortgage product. Shares in Taylor Wimpey were up 1.5 percent at 1024 GMT.

(Reporting by Lorraine Turner; editing by Rhys Jones)

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