Bovis is ready to rebuild; yourmoney: HOPE DESPITE pounds 8.6M LOSS.

Byline: CLINTON MANNING

PLUNGING property prices pushed Bovis Homes into the red in the first half of this year. But bosses believe the worst of the slump is over.

Bovis made an pounds 8.6million loss compared with a pounds 9.5m profit in the first six months of 2008 - despite axing 600 jobs to slash costs.

It flogged 754 homes, down from 851 in the same period last year, and the average selling price crashed from pounds 196,700 to pounds 160,400.

While that was a 20% fall it was just 3% lower than the second half of 2008. Boss David Ritchie said: "We took the worst of the pain on prices in the second half of last year. We've even raised prices on some sites in the past couple of months and they have stuck. On others we still haven't found the sweet spot yet."

His comments follow positive updates from rivals Bellway and Taylor Wimpey earlier this month while Britain's biggest builder Persimmon is expected to report an improvement in its fortunes today. But in a thinly-veiled attack on the banks Ritchie said many would-be buyers were still struggling to get a mortgage.

"First-time buyers need a 20-25% deposit and to be able to pay interest rates of between 6% and 7% which is simply beyond many people."

He also slammed some banks' valuers for putting low valuations on properties which forced Bovis to walk away from some deals.

Ritchie also fears that a sharp increase in unemployment could lead to a flood of secondhand properties on the market. But in his view the market was "stabilising" helped boost Bovis shares.

There have been several glimmers of hope for the housing market in recent weeks.

The number of new homes being built rose 63% in April to June while furniture shops saw big sales increases.

CAPTION(S):

OPTIMISM One of Bovis' homes