The chairman of housebuilder Berkeley Group has warned how changes to property tax announced in the Chancellor's Autumn Statement will not resolve the level of housebuilding required to meet crippling demand.
"We welcome the political support for the housebuilding sector in the Chancellor's Autumn Statement but are concerned that the continued changes to property taxation may well result in unintended consequences on the market and not lead to the level of housebuilding required to meet the underlying demand," he said.
"Delivering more homes of all tenures requires bold action with up to date Local Plans in place in every borough and a mechanism to bring large scale, complex sites into production more quickly.
"While the will is there, the process is slow and expensive and in this period of cuts, the role of the public sector needs to evolve so that it can become less risk averse and actively enable development."
His words came as the London-focused housebuilder reported a 3.8pc decline in pre-tax profit to £293.3m in the six months to October 31.
However, Berkeley's preferred measure of profit strips out any lumpy income it makes from selling properties from its portfolio of ground rent assets. On this basis, pre-tax profits actually grew 10.2pc to £242.3m.
The group continued to see good demand on new and existing housing schemes from both domestic and overseas buyers and its landbank grew by 800 plots to 38,233 in the period, while the development pipeline remained strong.
The encouraging outlook, coupled with a surplus of cash on the balance sheet, prompted Berkeley to announce an increase in cash returns to investors.
It raised its 2021 dividend return target from £13 per share to £16.34, with the annual dividend payout set to rise to £2 a share from £1.44.
In light of this, the board has also declared a further interim dividend of £1 per share (£136.5 million), payable on January 22, 2016.
Rob Perrins, managing director at Berkeley, said: "At this point in the cycle, and with forward sales and the estimated future gross margin in the land bank in excess of £3bn and £5bn respectively, the company has sufficient visibility to enhance the dividend return programme, while retaining sufficient capital to invest in opportunities that will add incremental value to the ongoing business."
He highlighted the former Parcelforce site at Stephenson Street, West Ham, as a major development opportunity for Berkeley, which has been selected as the preferred bidder for the site by the Greater London Authority.
"This important 27-acre site lies next to West Ham station and offers real place-making potential to regenerate this area of East London," he said.
"Berkeley's masterplan, on which we will be working closely with all stakeholders over the next few months, will deliver a significant number of homes, including homes for the private rented sector, and jobs, alongside retail, leisure and education spaces, all set around a major new park for London."
During the financial crisis, Berkeley cut dividends and used all its spare cash to buy up land cheaply between 2009 and 2013, a move from which it is now benefitting. The housebuilder sold 2,091 homes in the first six months of the year, at an average selling price of £506,000.
Berkeley has secured 14 planning consents this year - five on schemes which did not previously have an planning permission.
The new consents include 73 homes at Latchmere House in Ham, some 1,400 homes at White City, 594 homes at Southwater in Sussex and 247 homes at Taplow in Berkshire, in addition to over 800 homes at St William's site in Battersea.
During the half-year it started construction on four schemes and acquired six new sites, including large sites in Paddington and Fulham.
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