Shares in Berkeley Group jumped 8% yesterday after the house builder posted a 42% jump in annual profits.

The firm reported a pre-tax profit of £539.7m for the year to the end of April.

Strong demand in the company’s core markets of London and the south of England helped deliver the strong results – and though Berkeley built fewer homes, it charged more.

Berkeley sold 3,355 new homes during its financial year, down on 3,742 previous year, but its average selling price shot up from £423,000 last year to £575,000.

Berkeley has launched a number of new schemes this year, and said that all were marketed in the UK first.