First-time buyers are back, says Persimmon boss

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Chief executive Mike Farley said sales to first timers were up from 10 per cent at the start of last year to nearly a fifth.

"Sales to first-time buyers are back to being very close to the long-term average," he said, as Persimmon began the sector's season of trading statements.

Persimmon sold almost 5,000 new homes in the second half of 2009, up from 4,006 in the first six months. It said the completion rate was gaining faster momentum. The order book stands at £640 million, 40 per cent higher than this time last year, which Mr Farley described as "a good start to the year".

"We're cautiously optimistic," he said. "The number of forward sales is up massively, and we're seeing a good number of visitors to sites, with contract cancellation levels low. But the spring selling time is still difficult to call."

Mr Farley said mortgage availability had more than doubled from its low of 27,000 a month in November 2008, but pointed out that it was still below the long-term average of 93,000.

"Mortgage availability is still not high enough," he said. "We've got the new homes sites ready for buyers, but the wider economy means we're still having to wait and see."

He also said the upcoming general election was "fuelling the uncertainty" as buyers might hold back to wait to find out about tax changes.

Persimmon outstripped City predictions on debt, slashing it from £1.2 billion in April 2008 to about £270 million at the end of last month.

Chris Millington, analyst at Numis, said the firm had "comfortably beaten" its expectations on debt and forward orders, giving it "a strong platform for the spring selling season". Citibank said the company's trading statement showed "a slow but steady recovery in overall housing activity".

Persimmon bought 3000 plots during the last few months of 2009, with more than 80 per cent in southern England where Farley said higher demand was "radiating out from London".