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Bovis Homes says the recent turmoil in the financial markets has hit its sales.

The company is the latest housebuilder to express concern about the outlook for the industry in the wake of the ongoing global credit crunch that has been prompted by rising default levels in the US sub-prime mortgage market.

Last week its rival Taylor Wimpey said it expected the UK housing market to remain "subdued" over the next year, reporting that both visitor and reservation levels had dropped as a result of the economic turbulence.

In a trading update today Bovis revealed that it too had been hit by the impact of the credit squeeze.

"Recent events in the financial markets have adversely affected consumer confidence, resulting in sales being lower than anticipated during the key autumn selling period," Britain's sixth-largest homebuilder stressed.

The company said that both sale prices and volumes were expected to be down for the whole of 2007 as a result of weakening buyer sentiment.

Bovis said the average sale price for one of its homes was expected to be three per cent lower than that achieved in 2006.

However the company stressed that its operating margin, before taking into account restructuring charges from its recent acquisition of the Elite Homes group, was expected to remain at industry leading levels and in line with that reported for the first-half.

Bovis added that the integration of the regional housebuilder, which operates in the north of England, was progressing well.

The group expects to face a one-off restructuring charge of around £2 million in 2007 as a result of the Elite Homes takeover.