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Galliford Try edges higher as it brushes off UK property market concerns

A study from RICS on Thursday suggested that gloom has started to descend over the UK housing market but Galliford said on Friday it is seeing “good market conditions” across its businesses
new homes
Galliford has three divisions: Linden Homes, partnerships and regeneration, and construction

Housebuilder Galliford Try plc (LON:GFRD) has brushed off a gloomy recent study from the Royal Institution of Chartered Surveyors, claiming it is seeing “good market conditions” across each of its three businesses.

On Thursday RICS said pessimism among estate agents about the state of the UK property market is growing, with house prices not having risen at all over the past three months and likely to fall in most parts of the country.

READ: Galliford Try reports full year profit slump but confident outlook despite Brexit uncertainty

Instead, Galliford told investors that average sales rates in its Linden Homes housebuilding business have increased to 0.62 units per site per week so far in 2017, compared to 0.56 this time last year.

Linden currently has £652mln worth of sales reserved, contracted or completed (2016: £614mln).

It has a landbank of 11,200 plots across the UK and said land opportunities remain “positive”.

Galliford’s partnerships and regeneration business is “capitalising on its strong position”, and the company said recent government announcements have “provided increased certainty” to clients to bring forward investment.

The order book in this division sits at a record £1.3bn (2016: £873mln), with “significant growth in pipeline opportunities”.

READ: Galliford Try shares rise as Liberum initiates stock at 'buy' with positive outlook on housing market

Earlier this year, Galliford snapped up Drew Smith and said on Friday the integration and performance of the new addition has been “positive”.

 The company’s third arm, construction, “continues to maintain an excellent order book” of £3.6bn (2016: £3.4bn), while the underlying business continues to “perform well”.

“We continue to make good progress against our strategy to 2021 with clearly defined plans across all of the three businesses that are integral to Galliford Try, which provides the board with confidence in its ability to deliver a strong performance even in a period of lower growth in the wider economy,” said chief executive Peter Truscott.

Shares rose 1.5% to £11.95.

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