Berkeley Group posted higher than expected earnings on Wednesday.
It reported pre-tax profits of andpound;539.7 million for the year through to April, significantly higher than the andpound;470 million expected by analysts.
Adjusted pre tax earnings of andpound;454.6 million, an increase of 19.6% from the previous year, resulted from the sale of 3,355 new homes at an average selling price of andpound;575,000, with an additional andpound;85.1 million from the sale of a portfolio of ground rent assets.
There is little doubt that the UK housing market is starting to recover and see a revival following its collapse in 2007.
House prices are rising and confidence in the economy along with job stability and an increase in wages in real terms have all contributed to more buyers looking to purchase homes and therefore bolstered the demand for Berkeley Homes.
This has been especially evident in London and the South East of England where demand has been particularly strong.
The market is clearly impressed with Berkeleys performance with shares jumping a massive 8.5% in the morning session, taking the share price to an all time high of 3427p.
This is adding to what has been a phenomenal year for the share price, which has rallied over 39%, much of which was seen after the Conservatives won a majority in the general election giving a more stable outlook to the property market and house building industry.
Berkeley Group is not alone in its stunning performance, with other house builders also enjoying a robust start to the year and strong pre tax profit performances.
However there are still some political speed bumps to come, such as the London mayoral elections and more importantly the EU referendum, which could yet knock the industry back.
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