Berkeley Group to join NewBuy scheme

Berkeley Group has confirmed it intends to participate in the government-backed mortgage guarantee scheme launched last week, as it issued a trading statement saying market conditions had not worsened since last year.

The firm, which laid out a plan to return a £1.7bn to shareholders in June last year, said in an interim management statement covering the four months to the end of February that forward sales were up 23% on the figure last year, at more than £1bn. It said it was on target to double its pre tax profit to £220m by April 2013.

It added that it intends to “participate in full” with the NewBuy mortgage indemnity scheme launched last week by the government with the support of seven housebuilders. At the time Berkeley Group was the most notable omission from the list which included all of the other listed housebuilders.

In a statement the firm said: “Berkeley warmly welcomes recent Government initiatives such as the innovative New Buy scheme which is expected to provide an additional stimulus to support demand for new homes.”

The firm launched seven new schemes over the period, and bought a further seven sites for £80m. In addition it said the “gross margin potential” in the firm’s land bank had increased to £2.5bn, at the higher end of previous guidance.