UK homebuilder's profits crumble

Britain's Bovis Homes Group saw its profits crash 84 per cent during the first half of the year, it has announced.

Pre-tax earnings for Bovis fell from £58.5 million during the six months ended June 30th 2007 to just £9.5 million for the same period this year.

Revenue at the group stuttered to just £149.3 million during the first half, down from £259.9 million a year ago.

As a result of the sizeable dip in profits, Bovis claimed it has "reduced production levels" and is "largely avoiding new land commitments".

The lack of new developments could see more first-time buyers considering the self build option. On the other hand, there is a possibility that existing homeowners may look to improve their homes rather than move to a new development.

New research from the mortgage adviser Mform.co.uk has calculated that homebuyers looking to secure a competitive rate now require a deposit of close to £40,000, up from £21,000 last year.