Nov. 4 (Bloomberg) -- Taylor Wimpey Plc, the U.K.’s largest homebuilder by market value, said the average price of homes on order rose 9 percent from the first half as the market continues to be “significantly better” than last year.

The company has opened 22 more sales sites so far in the second half, London-based Taylor Wimpey said today in a statement. Cancellation rates have fallen to 16 percent, from 19 percent in the first half, it said.

Evidence is growing that the country may have exited its worst property slump in 25 years. Mortgage lender Halifax, a division of Lloyds Banking Group Plc, said yesterday that home values climbed by 1.2 percent in October, after gaining 1.5 percent in September.

“We didn’t experience the usual industry seasonal slowdown over the summer, and sales rates have remained solid into the autumn,” Chief Executive Officer Pete Redfern said in an interview. He said data from mortgage lenders Halifax and Nationwide Building Society tend to exaggerate price increases and decreases, and said he sees “a solid, stable market,” but nothing more.

Taylor Wimpey gained 8.2 percent to 40 pence in London trading. The shares fell as low as 3.34 pence in November as the U.K.’s biggest housing slump in 30 years pushed the company toward breaching banking covenants and forced it into nine-month rescue talks with lenders.

Lending Pressure

The U.K. homebuilding market’s recovery could be hampered by restrictions on mortgage lending proposed by the country’s financial regulator, according to analysts. The Financial Services Authority on Oct. 19 proposed a ban on self- certification home loans and advocated affordability tests for all mortgages. It’s also seeking to make lenders ultimately responsible for assessing a consumer’s ability to pay.

“There has been a whole series of changes to the mortgage market, but no one thing that will fundamentally increase or decrease mortgage availability,” Redfern said. “We see a slow and steady grind back to mortgage availability to a level below what we saw in 2006 and 2007.”

The order book stands at 1 billion pounds ($1.65 billion), little changed from a year ago, the company said. Taylor Wimpey now has 317 active sales sites, compared with around 500 at the top of the market in 2007. It may open 30 to 35 sites in the second half, Redfern said.

The company has also joined peers in buying land, with 1,011 plots at eight new sites being bought since July in the U.K. at discounts of more than 60 percent from the peak in some cases, Redfern said. In North America, the group has bought 2,240 plots in the second half to date. The company has about 60,000 plots of land in the U.K. and 22,000 in North America, he said.

Net Debt

Net debt fell to around 860 million pounds from 1.87 billion pounds a year earlier. That’s lower than the company’s previous estimate by 100 million pounds, it said.

In a separate statement today, Redrow Plc, the U.K. homebuilder that saw founder Steve Morgan rejoin management in March, said that net private reservations in the first 18 weeks of the year were up 47 percent compared with the year earlier. The group also expects to receive the 150 million pounds from its recent rights issue “shortly.”

The country’s other housebuilders rose on the back of the statements. Persimmon Plc, the third-largest by volume, gained 11 percent to 424 pence, with Redrow and Berkeley Group Holdings Plc both gaining more than 7 percent. Barratt Developments, the U.K.’s biggest by volume, increased 13 percent.

To contact the reporter on this story: Tim Barwell in London on tbarwell@bloomberg.net

Last Updated: November 4, 2009 12:22 EST