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Redrow looking to restart stalled work

Housebuilder Redrow is cautiously restarting construction work on key sites in response to indications the market is stabilising.

This follows months of scaling back work in response to the credit crunch.

In an interim management statement covering the period since January this year the company said: “We have been encouraged by sales activity since the start of the calendar year with sales rates per outlet ahead of the same period last year.

The statement the company would be focusing on building to “improved specification” which would hopefully generate higher profits per home.

It added: “We have remained tightly focused upon reducing work in progress to appropriate levels for the prevailing environment.

“With sales volumes in the housing market seeming to have stabilised, we are recommencing construction on certain developments and starting new sites from our existing land bank.

“Interest in the land market generally is re-emerging though the number of transactions actually being completed remains relatively low. We will pursue such opportunities carefully with a focus on Redrow's historic competitive strength of traditional family housing.”

However, the statement said pricing remained fragile although the speed of house price falls has slowed in recent months. Unsold housing stock has also reduced substantially, but Redrow believes the market will remain challenging into 2010.