Bovis Homes Group PLC (LON:BVS) shares jumped higher at the opening bell after the housebuilder issued a bullish update on the outlook for the UK property market.
The FTSE 250 company said the market “remains strong” while customer interest “remains good”, both underpinned by “strong” fundamentals.
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“The demand for new homes continues to be robust across all our regions and customer interest remains good,” this morning’s statement said.
“The industry fundamentals are strong given the government's housing policy, in particular Help to Buy, the low interest rate environment, and the competitive mortgage market.”
Bovis told investors it is on track to hit full-year expectations having fully sold for its targeted completions for 2017 with an average sales rate of 0.52.
After a couple of land sales brought in £12.9mln and it disposed of its shared equity portfolio for £21.9mln, Bovis reckons it will have a net cash position of at least £100mln at the end of the year.
READ: Bovis Homes up as first half trading in-line with its reduced expectations, but increases legacy provisions
It added that it expects a “significant improvements” in profits next year, somewhat driven by a newly-implemented cost-cutting strategy.
Earlier in the year the group said it wanted overheads to be a maximum of 5% of revenues from next year onwards and confirmed on Tuesday it is on course to meet that target, although it will still take an exceptional £4mln restructuring in the second half of this year.
Bovis shares added 1.7% to £11.24 shortly after the opening bell on Tuesday, while rivals Barratt Development PLC (LON:BDEV), Persimmon PLC (LON:PSN) and Bellway PLC (LON:BWY) were also boosted by the upbeat statement.