Forward demand for homes

Soaring fuel bills are a major factor in record forward sales at Stewart Milne Homes (SMH), according to bosses at the up-for-sale north-east housebuilder.

Stewart Macgregor and Fraser Park, chief executive and finance director respectively at the parent Stewart Milne Group (SMG), said pressure on household budgets was not, so far, hitting property sales.

To the contrary, people are prioritising their homes and often contemplating house purchases, while at the same time making sacrifices elsewhere in their lives, they said.

One of the reasons people are so keen to move to modern new, energyefficient homes, such as those sold by SMH, is the chance to reduce their energy costs, the pair added.

The comments came as SMG announced a narrowing of losses and 13% jump in turnover during the year to October 31 2021.

SMH – based in Westhill, Aberdeenshire – has benefited from pent-up demand, following Covid lockdowns, as well as changing market trends and house price inflation in some areas where it builds homes.

The market on its own doorstep has been in the doldrums for years but Mr Macgregor said there were now signs of that changing, with average prices in and around Aberdeen rising for the first time since 2015.

SMH has also been encouraged by strong demand in Dundee, where it is on the hunt for more development sites.

Ballumbie Rise, Dundee, is one of SMH’S fastestselling projects to date. The firm is moving forward plans for second phase, with 150 new homes, after recently winning a planning appeal.

Mr Fraser said 76% of the total sales targeted by SMH for 2022 were already secured.

That, together with an improving north-east market, a more efficient housebuilding operation – “significantly” driving up profit margins – and a big revamp for its range of homes, mean SMG is wellpositioned for future growth, the firm’s finance chief added.

Mr Macgregor revealed a sale of SMH is likely to take place before the end of this year.

There is “good interest” from a range of potential buyers, he added.

It follows the recent

announcement that multi-millionaire Stewart Milne, SMG’S principal shareholder, was to retire.

SMG is now wholly focused on housebuilding, having last year sold kit home business Stewart Milne Timber Systems

(SMTS) to Fife-based timber giant James Donaldson & Sons for an undisclosed sum.

SMG posted pre-tax losses of £8.1 million for 2020-21, following a trading deficit of £71.5m the year before.

The group highlighted operating profits of £13.5m before one-off items in the latest period, up from £800,000 previously.

Turnover raced ahead to £305.5m last year, from £269.7m in 2019-20.

EXPANSION: Stewart Milne Homes’ Ballumbie Rise project in Dundee has sold quickly.