Berkeley Group has reported a 53% rise in pre-tax profits in it's final results for the year.

With profit before tax up to £812.4 million from £530.9m in 2016, the company said it is on target to deliver at least £3 billion of pre-tax profit by 2021. Elsewhere, Revenue rose 33% to £2.72bn (2016: £2.05bn).

The Group accounts for 10% of homes under construction in London and has built 19,000 new homes in the last five years.

However despite it's results, Chairman Tony Pidgley warned about market uncertainty with the value of reservations 25% lower than seen in 2015/16.

"The housing market in London and the South East has stabilised in the second half of the year, following the significant market dislocation around the EU Referendum last summer," he said.

"Taking the year as a whole, including the period around the EU Referendum,  the value of reservations is 25% lower than in 2015/16, but this decline has now fully reversed with the return to more stable market conditions in which reservation cancellation rates are at normal levels."

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"While these conditions are adequate to meet our profit guidance, they do not support the much needed growth in housing delivery in London and we have seen the number of new starts fall by some 30% across the Capital, according to latest figures released by the NHBC and Molior.  This is a result of both demand and supply side pressures. The high levels of property taxation, reduction in mortgage cost deductibility and the uncertainty that Brexit creates combine to dampen sentiment and demand. While the planning environment, with increased demands from a combination of Affordable Housing, CIL, Section 106 obligations and review mechanisms, acts as a restriction on supply.

"We continue to see distortions in the market from these policy measures with UK investors most acutely affected by the taxation changes, offset by overseas customers seeing relative value in the London market. The new build market is a small proportion of the overall housing market but drives the delivery of additional housing stock and, importantly, new affordable homes. The capital intensive nature of regenerating the complex sites that remain to be developed in London requires the certainty of cash flow and de-risking that forward sales to investors generate. It is therefore important that London remains the open, diverse and aspirational global city that contributes so strongly to the UK's prosperity."

(LM/MH)