HOUSEBUILDER Barratt Developments warned it was too early to predict a pick-up in the property market, despite posting strong half-year profits.

The Newcastle company said there were signs that buyer confidence was on the increase following a lift in sales completions and profits.

The firm said that despite "tougher times", turnover in the six months to December 31 had increased two per cent to £1.2bn and profit was up four per cent to £163.9m.

Barratt said forward sales had reached £910m and it had secured 90 per cent of its annual sales target for the year to the end of June.

Completion figures had risen two per cent to 7,003 homes, at an average selling price of £166,600.

Chief executive David Pretty said: "On current form, we are on track for another successful year and are in good shape going forward."

Barratt, the second-biggest housebuilder by market value, said its presence in a wide range of markets had insulated it from the market downturn of last year.

The company's expansion into social housing saw completions in this area rise 14 per cent to 1,434 homes.

Chairman Charles Toner said 2005 had been a challenging year, but Barratt was on course for a 14th consecutive year of progress.

"We had prepared for tougher times, with wide-ranging and improved efficiencies in our selling and market operation and also by steadily increasing sales outlets," he said. "While the market remains competitive, there have been positive signs in the first weeks of 2006 that buyer confidence is improving with encouraging recent sales trends."

Barratt is working on more than 20 developments across the North-East and North Yorkshire, including at sites in Darlington, Stockton, Middlesbrough, Durham, Newcastle, Catterick and York. The company employs more than 100 people at offices in Newcastle and York.

Last night, Barratt shares closed 10p higher at 1085p, a rise of one per cent.