french developer announces strong half yearly results
News Posted On: 02 August 2011
The French developer and house builder, Nexity, has just announced its half yearly results which showed significant improvements within the French residential sector. The results showed margins improving to 9.5% over six months’ worth of revenue totalling €1,215 million. The developer is anticipating reservations for 10,000 new homes this year, and the total new homes market is expected to be 100,000.
Apparently the first half of the year continued to be challenging due to uncertainty in the market and within the overall economic environment, but sales volumes were maintained. Although there were fewer sales recorded for individuals, this was compensated for by an increase in block sales to social housing groups and institutional investors. This led to a larger number of transactions in markets constrained by supply, which in turn led to greater profit margins.
According to the developer, the property market within France is split into two sectors, where prices are continuing to rise in regions where the supply is short, particularly in Paris and other large cities, while other more provincial regions are seeing limited market growth.
In general the market appears to be in pretty good shape which is partially due to lenders helping first-time buyers through a zero interest loan scheme called the PTZ+. This scheme is proving particularly helpful in urban areas, and some 68% of first-time buyers purchasing property from Nexity made use of this scheme during the first six months of this year.
Buy to let investors are also on the increase, and represented 20% of total sales during the first half of this year, compared to just 13% in 2010.
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Written by Les Calvert
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