Berkeley on course to meet targets
Housebuilder said it was on track to meet its expectations for 2016iStock

Housebuilder Berkeley Group said it expects results for the current financial year to be at the top end of expectations, indicating the London property market remained stable between the end of last year and the beginning of 2016.

The FTSE 100-listed company forecast its results for 2016 to be at the high end of guidance after absorbing approximately £25m (€32m, $36.1m) in expenses and added it was on course to deliver £2bn of pre-tax profit in aggregate over the three years culminating in 2017/18.

Berkeley indicated that in spite of the uncertainty surrounding the global economy, including the impending UK European Referendum, underlying demand remained strong in the period between 1 November 2015 and 29 February 2016.

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However, it added that transaction levels at the upper end of the housing market have been affected by the significant increase in transaction taxes over the past 18 months, which will have consequential effects on both social mobility and the supply of new homes.

"Since the half year, we have sold 62 properties at prices over £2m – a similar number to the same period in 2014/15, when the market slowed in the run-up to the general election," the company said in a statement.

"Reservations are approximately 4% lower than in 2014/15 due to a change in mix of product and the strength of the forward sales secured in recent years."

In January, the group paid a dividend of £1 per share and is on target to pay a further £1 per share in September 2016, in line with the new dividend payment schedule. Together with the planned net investment in the second half of the year of approximately £200m, the dividend paid in January will see net cash at 30 April 2016 in the region of £100m, Berkeley added.