• 18 Mar 2016

Persimmon has become the latest builder to benefit from the country's chronic housing shortage after reporting a sharp rise in annual profits.

Higher selling prices and a rise in the number of homes sold, driven by a lack of supply on the market, pushed sales up by 13pc to £2.9bn in the year to the end of December, while pre-tax profits jumped by more than a third to £638m.

The good result means the FTSE 100-listed house builder will pay out more cash to its shareholders than previously announced. It will pay a 110p dividend to investors on April 1, significantly higher than the planned payment of 10p per share.

The additional windfall means shareholders are now on track to get a cash return of £2.76bn, or £9 a share, by 2021, a 45pc increase from the original plan set out in 2012 to pay out £1.9bn by 2021, or £6.20 a share.

The average selling price of Persimmon's homes increased by 4.5pc to £199,127 last year, while the number of homes it sold rose 8pc to 14,572 . It also acquired a further 20,501 plots of land to add to an already robust pipeline of potential development sites.

Since 2012, the number of homes that Persimmon has sold each year has increased by almost 50pc.

The group attributed its success to a “confident housing market” in the UK, buoyed by stronger employment levels and an improvement in disposable household incomes.

The company also said the government’s Help to Buy scheme, which assists first-time buyers in getting on the property ladder, was helping to support the mortgage market.