Housebuilders to receive £500m rebate

Struggling housebuilders are set to receive a £500 million rebate from the taxman.

The industry has suffered dramatically in the wake of falling house prices and the mortgage squeeze, which has led to a severe decline in the number of property transactions.

However, the industry is set to receive huge rebates following significant losses in the last 12-18 months after developers wrote down the value of their land.

It is understood that Revenue & Customs has accelerated the payment of rebates to help the ailing sector.

Persimmon is one housebuilder who has been struggling of late, last week the developer said it completed the sale of 10,202 units in 2008, down from 15,905 in the previous year.

Last week, the developer received £150 million following a £640 million write-down of its land bank in 2008. As a result, the company was able to reduce its debt by 34% to £600 million in the past six months.

It is believed that Barratt, Bellway, Bovis, Redrow and Taylor Wimpey are all to receive rebates in the next few months.

Story link: Housebuilders to receive £500m rebate