Tough trading conditions in the US impact group performance but UK housing market remains strong

The continuing decline in the US housing market has forced Taylor Woodrow to writedown £20m ($40m) against its North American landbank though it remains upbeat about the rest of its business.

The housebuilder said it would still report a strong result in North America for 2006 because of forward sales in 2005. However the overall order book for North America is down 39.9% to £440m ($854m) although home completions were up 14.2% to 4,492.

The news came in a trading statement to the London Stock Exchange for the year ending 31 December 2006.

Taylor Woodrow said its UK performance was much stronger. Home completions increased 1.4% to 8,294 while the average selling price went up 4.3% to £193,000. Its landbank stands at 34,827 plots or 4.2 years supply.

In Spain and Gibraltar the group said that delays to obtaining habitation certificates meant completions had fallen 6.7% to 379.

Taylor Woodrow said the outlook in the UK was favourable providing consumer confidence was not damaged by future interest rate rises.

However in the US, it expected margins and return on capital to be squeezed in the longer term.