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August 2009

Connells’ sales and profit boost

City Correspondent

CONNELLS, the country’s second-biggest estate agency group, have reported a 23 per cent rise in sales during the first half of this year, a rebound in profits, while its parent Skipton Building Society believes the housing market has bottomed out.

Connells’ group chief executive Stephen Shipperley expects further profit growth during the second half due to strong "pipeline business". 

 The group’s contribution to  pre- tax profits of its parent, Skipton Building Society was £20.8 million during the first half of this year, compared with only £10.5 million for the whole of 2008.

Mr Shipperley said: ”I expect the second half to be even better, due to the strong growth of pipeline business. We recorded 23 per cent more sales during the first half of this year compared to the same period of last year but this understates the recovery as April and May last year  were poor months for sales.

“Sales in June this year were double the June 2008 figure. On average, we are achieving 65 per cent higher weekly sales than this time last year.”

He said prices   “had stopped falling” and there were local shortages of supply.

“We have been through the worst housing conditions in living memory and I hope we are in a slow but sustained recovery, “ he added. 

“I must say that I think the chances of a major estate agency group   going under this year has receded.”

The Connells figures were released as the Skipton Building Society announced a first half profit of £17million , compared with only £22.5 million for the whole of 2008.

The society’s assets rose from £13.6 billion to £15.2 billion largely as a result of merging with the smaller Scarborough society. Bad debt provision rose from £7.9 million to £22.1 million but compared with £27 million to the six months to December.

David Cutter, chief executive of the Skipton, said the Connells result suggested the housing market had hit bottom but any recovery will depend on the trend  of unemployment.