Housebuilder Barratt expects climb in prices of new homes

Barratt said it was selling more family homes rather than city-centre apartments

Barratt expects the average sale price of its homes to rise by up to 10pc this year.

But the housebuilder stressed this was due to its focus on selling larger homes rather than the start of another housing bubble.

The housebuilder"s chief Mark Clare said: "What we don"t want is massive price inflation and another boom and bust cycle."

The builder posted a half-year pretax loss of 178.4m - a vast improvement on a reverse of 594.5m a year ago.

The figures were hit by one-off charges totalling 130m, mainly related to changes to its debt financing.

Average selling prices rose 3.5pc in the half to 166,300.

Barratt set some nerves jangling when it lowered its sales completions target for the year from 12,000 to 11,500 homes.

But, it stressed this would not hit earnings because it expects fatter margins to make up for the lower sales volumes.

This is because it is selling more family homes rather than cheaper city centre apartments.

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Barratt (down 7p at 114.8p) has secured forward sales worth 847.4m, accounting for 77pc of its full-year target.