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Berkeley buoyed by London demand

Berkeley has said demand in London has remained strong over the last three months, but away from the capital, business has been tougher.

The South-east based housebuilder blamed reduced credit availability and a dip in consumer confidence for the struggles outside London.

A report from the group said: “Demand for properties in the period from 1 May to 31 August 2010 has been resilient, particularly in London which has a shortage of supply and specific demand from international purchasers who are keen to invest in the capital.”

It added: “Outside London, which is reliant on the UK domestic economy to a greater extent, a lack of credit availability and overall consumer confidence is a constraint to achieving an increase in transaction volumes at this point in the market cycle.”

According latest figures, the company has maintained forward sales above £600 million.

Although changes to the planning process will affect the construction sector, Berkeley said it expects to achieve its target of growing earnings per share by 10 per cent for the financial year.

A statement from the company said: “Our industry is currently experiencing an unprecedented number of changes to regulations which will affect the design of new homes. When coupled with the anticipated reduction in funding for affordable homes, this is likely to result in a lower level of new homes unless the planning burden is reduced.”