Housebuilder Wilson Bowden has unveiled record annual profits, but sounded a cautious note about prospects for the UK housing market.
While the Leicester-based group reported signs of increased buyer confidence in recent weeks, it said it was still too early to predict the outcome of the key springselling season.
Pretax profits lifted 15.6 per cent to £260.5 million in the year to December 31 despite a "significantly more cautious" attitude among buyers from around the middle of the year.
Across the group - which in Birmingham is developing the Solihull Business Park, Nexus Point industrial park and is working on housing schemes in Bournville and Hagley Road - sales lifted ten per cent to £1.28 billion.
It said the nervousness of buyers had been evident, with sales slower and more difficult to bring to a conclusion, and this was reflected in the forward order book for the first half of 2005.
Chairman David Wilson said: "For 2005, I believe that we shall see a slower start to the year, particularly given the buoyancy of the market at this time last year."
He believed it was possible there would be a "progressive return" to a more confident outlook as the year unfolds.
When asked about prospects for 2005, chief executive Ian Robertson said: "After eight weeks of trading, it's just too early to call.
"But there are encouraging signs."
Life was still tough for builders as they were having to increase incentives, such as part-exchange deals, to secure buyers.
Higher- building costs would pressure margins if prices did not increase, Mr Robertson warned.
He added the chances of a "soft-landing" for the UK housing market - where prices stagnate after recent steep rises rather than fall back - were better than a few months ago.
The group's main housing business, David Wilson Homes, comfortably beat its targets by completing 5,588 houses with an average selling price of £206,000. This helped lift operating profits by 14.2 per cent to £248.8 million.
Property development-arm Wilson Bowden Developments saw profits rise by 22.2 per cent to £33 million.
Looking ahead, a spokesman said that historically, buyers tended to hold back on purchases in the run-up to a General Election, causing the market to cool down.
Analysts said Wilson Bowden sounded a little more cautious than rivals such as George Wimpey, Persimmon and Taylor Woodrow , but that it had a tradition of beating expectations.
Wilson Bowden's shares closed at 1240p up 11/2p.