Ben Bailey finds housebuilding market tough

Ben Bailey has found the housebuilding market in 2005 to be tougher than anticipated.

While turnover in the first six months of the year bounced ahead to £45m, a rise of 22% on the comparable period last year, Bailey’s interim results show an 18% decline in pre-tax profit to £6m.

Richard Bailey, chairman, said: “The optimistic view held in the early months of the year failed to be fulfilled. A slowdown in the second-hand housing market brought about uncertainty in prospective buyers.

“There has been a need to employ more sales incentives to maintain volume output and an efficient build programme. Increases in the cost of some materials and labour have also contributed to the decline in margins.”

Bailey said that subdued market conditions will continue to affect the operating margin – in the six months to 30 June it was 17%.