Autumn selling boosted British housebuilders Berkeley Group and Bellway, but uncertainties such as a looming general election, unemployment and mortgage shortages are curbing enthusiasm.

We've got a situation of imbalance at the moment. Until we get the feel-good factor and we see mortgages back, then we've got two markets, Berkeley's chairman Tony Pidgley told Reuters.

Berkeley, the third largest builder by market value, reported its half-year pretax profit down over a third, but its margins and cash position impressed.

Smaller housebuilder Bellway forecasted a 10 percent increase in first-half sales with house sales averaging 91 a week in a trading update. [ID:nGEE5B3063]

Bellway and Berkeley both present a positive case on trading, but the Berkeley story feels more robust, said Robin Hardy at KBC Peel Hunt, adding that Berkeley's profits and margins set the company aside from volume housebuilders.

UK house sales and prices have stabilised this year after one of the deepest and sharpest drops in activity in many decades, indicating growing consumer confidence. [ID:nL4449667]

British house prices rose in November by 0.5 percent, the seventh consecutive rise in the Nationwide house price index, supported by a lack of properties coming onto the market. [ID:nGEE5B00HU]

I do feel, that now we've had some months of this, the market is bumping along the bottom, added Pidgley, after Berkeley's saw private sales dropping 80 percent in the wake of the collapse of Lehman Brothers last year.

Berkeley said the value of sales is still 40 percent lower than the group's average over the last six years, but the weaker sterling is helping to boost sales in the London market by attracting overseas buyers.


Housebuilders, which are heavily impacted by wider macro economic factors such as unemployment, say a change in government at the next general election may dent consumer confidence.

If Labour becomes Conservative, there are bound to be's another small brick in the uncertainty wall. That just creates a hiatus period. I think it's a natural negative, Bellway's Chief Executive John Watson told Reuters.

It doesn't really matter to us if it's Labour or Conservative. We just want clarity to which one it is. A hung parliament would be worst for all of us because of the uncertainty, said Berkeley's Managing Director Rob Perrins.

Berkeley, which specialises in luxury flats developments, often on prime riverside locations in the south-east of England, posted a 35 percent drop in pretax profit to 52.0 million pounds ($86.23 million), in the six months to end October on revenue of 290.1 million pounds compared with 452.6 million pounds last year.

The London-based developer, which said it has renegotiated and lowered its banking facilities to 300 million pounds until November 2013, sold 914 units in the first half at an average selling price of 299,000 pounds. This compares with 968 units at an average selling price of 399,000 pounds in the same period last year.

Meanwhile Bellway said sales in the north of England continue to be stymied by an over-supply of products of a similar nature, as well as low demand.

Shares in Bellway were down 0.72 percent at 1101 GMT, while shares in Berkeley were down 3.7 percent.

(Editing by James Davey and Sharon Lindores) ($1=.6030 Pound)