Bovis embarks on land buying spree Bovis Homes Group, the UK housebuilder, is purchasing twice as much land as it is developing as it seeks to take advantage of depressed prices that have not yet recovered from the 2008 slump. Land prices fell sharply in 2008 as the financial crisis impacted on the housing market and have remained broadly stable ever since. With prices still 30 to 40 per cent off their peak, Bovis has embarked on an aggressive land buying spree. The housebuilder bought 1,835 plots with planning consent on 11 sites in the six months to 30 June, almost double the number it sold. The group bought 1,571 plots with planning consent during the same period in 2011. David Ritchie, chief executive of Bovis, said the group was keen to take advantage of opportunities to acquire high-quality land with planning consent, mostly in the south-east. So long as the housing market remains flat, land prices will remain relatively stable. There's still a limited number of buyers out there and if anything, private housebuilders are selling as they need the cash. The company delivered 944 homes in the six months through June compared with 801 a year earlier, an 18 per cent increase. The average selling price rose 1 per cent to £164,400 after Bovis focused on more profitable family houses rather than flats and apartments. Despite the squeeze in mortgage lending that has stalled house prices, the larger listed UK homebuilders have increased margins by selling homes built on cheaper land. Barratt, Taylor Wimpey, Bellway, Redrow and Berkeley have been gaining market share as the squeeze on credit forces out smaller private competitors. They have also switched towards the more resilient south east. The gross margin for Bovis's homes rose to about 21 per cent in the first half from 20.1 per cent a year earlier, the company said in a trading statement for the six months to 30 June. Nevertheless, Charles Campbell, analyst at Liberum Capital, said the trading statement was disappointing compared to peers. While we upgraded estimates for Persimmon and Taylor Wimpey last week, Bovis remains on track to hit existing forecasts in 2012. However, 2013 and 2014 should see stronger forecasts as selling prices start to reflect the deliberate shift in mix towards the south. Last week, Taylor Wimpey and Persimmon reported relatively buoyant spring selling seasons despite the continued weakness in the wider economy. Shares in Bovis closed down 2.66 per cent on Monday at 462.39p.