Bovis Homes, the Kent-based house builder, expects to finish the year with strong results thanks to rising house prices and soaring demand.

The New Ash Green-based firm thinks volumes will increase by about 30% to 3,650 homes compared with last year as sale prices rise by about 10%.

In an announcement on the London Stock Exchange, bosses said the business has felt growing pressures on build cost, particularly in labour, but believes the sales price gains will mitigate the impact this year.

The company’s operating margin is expected to rise to 17% from 14.9% in 2013.

The statement said sales prices have “continued to be robust in the second half of 2014” but sales rates are lower than the same period last year, when the Government introduced its Help to Buy scheme.

Chief executive David Ritchie said: “We are anticipating a strong increase in profit for 2014 and at the same time expecting to deliver a stronger forward order book for the start of 2015.

“The group’s updated strategic plan as laid out at the time of our Interim Results to deliver optimal scale and enhanced returns is supported by our ongoing land buying and strategic land conversion.

“We are confident of our future prospects and ability to deliver improved shareholder returns through higher return on capital employed and increasing dividends.”