House prices lift Persimmon results as firm prepares for stabilising market

Persimmon has reported a 31% jump in pre-tax profit for the half year to 30 June 2015 to £272.8m ($425.3m) and revenues of £1.33bn.

Chief executive Jeff Fairburn said that he was happy with how the builder had been trading in the first half and told investors he thought Persimmon had managed to make the most out of the state of housing market.

He added: "We have now entered the traditionally slower summer weeks for the market. Our private sale reservation rate since 1 July is currently 5% ahead of the same period last year which is a reflection of the continuation of healthy customer demand."

"The performance in the first half of 2015 further demonstrates the results of the group's focus on successfully executing its operational objectives and the delivery of the 10-year strategic plan launched in 2012."

Although the company reported a 4% rise in the average price of the houses it finished, the rise in revenue was largely fuelled by a 7% increase in the number of houses legally completed in the first half year of 2015 as compared to the same period in 2014.

House prices have been soaring over the past years but stabilisation is expected. Persimmon argues it is prepared for unexpected market movements by its high cash generation and strategic investments.

The company also said that the rise in average wages, and therefore the disposable income, would help first-time buyers, despite higher prices.

Persimmon stated that the economic recovery and the increased wages "creates a positive backdrop for the housing market across the regions".