Bovis warns of tough conditions

Housebuilder Bovis Homes has warned that it is operating in its worst trading environment "for many years".

The firm now expects to complete about 1,800 home sales this year, down 39% from 2007's total of 2,930.

Bovis said it planned to cut more costs as it warned of write-downs amid the current housing market malaise.

It now hopes annual overheads will be below �45m by the end of 2008 after shedding 40% of its staff since the start of the year.

Sales 'incentives'

Sales prices have endured further downward pressure

Bovis

Rival housebuilders Persimmon, Redrow and Barratt have also announced job cuts as they seek to reduce costs and survive the market downturn.

To cut costs, Bovis has already reduced production levels and is largely avoiding buying any new land.

Bovis said that a reduction in the availability of mortgage finance had led to a "sharp decline in home buying activity".

And it said that almost all the sales that it has achieved since August this year "have required greater discounts and incentives".

"As a result sales prices have endured further downward pressure which is having a detrimental effect on profit margins."

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