The company's shares were 4.4% higher at 2729 pence by 0747 GMT, making it the top gainer on Britain's FTSE 100 index.

After coming to a virtual standstill in late March and April, Britain's housing market has picked up pace as pent-up demand, tax breaks for home purchases and a desire for suburban living buck the usual summer slowdown.

Persimmon declared a "modest" interim dividend of 40 pence per share in place of 125 pence a share payment it cancelled earlier.

It is one of the first UK-listed companies to bring back a dividend, providing some optimism for investors after the coronavirus crisis hammered the sector.

The UK's second-largest homebuilder said it expects to deliver about 45% of its second half new home completions by the end of September, adding that its gross margin remained resilient due to lower costs.

"This year is increasingly looking to be a game of two halves for Persimmon, with the outlook rather brighter than the pandemic-hit first few months," Richard Hunter, Head of Markets at Interactive Investor said.

Britons bought and sold a record number of homes between mid July and early August, according to property website Rightmove.

"Potential medium-term risks to demand associated with Covid-19, rising unemployment and Brexit remain, but long-term housing market fundamentals continue to be strong," Persimmon, which competes with Taylor Wimpey and Barratt Developments, said.

Persimmon sold 4,900 homes in the first six months of the year compared with 7,584 in the year earlier period, with the average selling price rising to 225,066 pounds ($295,736) from 216,942 pounds.

Pretax profit fell to 292.4 million pounds from 509.3 million pounds.

($1 = 0.7610 pounds)

By Samantha Machado