Persimmon today sounded a note of cautious optimism after selling more homes than expected this year amid signs that the fall in house prices is easing.

The house-builder said cancellations, where potential buyers walk away from their deposit rather than purchase a new-build home, hit a record low of 16 per cent between April and June, boosting hopes that conditions in the market are set to pick up further.

Yesterday, analysts revised up their outlook for the housing market.

Economists at Royal Bank of Scotland now expect the peak to trough fall in house prices to be 30 per cent, rather than 35 per cent. Prices have already fallen by more than 20 per cent since the market peaked in Autumn 2007.

The builder said that the number of sales completed in May and June were "consistently ahead of the same period of 2008." It has sold more than 4,000 homes so far in 2009. Forward sales revenue for the second half of this year has also jumped to £700 million, up from £650 million at the same time last year.

However, the builder highlighted the continued constraints on mortgage lending.

"We are encouraged by the improvement in sales rates when compared to last year, but will remain cautious until mortgage availability improves further and employment prospects stabilise," Persimmon said today.

It said it would continue to focus on cash generation and the reduction of its debt pile, which it has fallen from £906 million to £495 million at the end of June.

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