BUZZ-UK homebuilders: cash is king

** Housebuilders' shares at record highs not putting buyside off as fund managers bet impressive cash returns in low-return world will keep gains coming

** While there are risks - inconclusive UK General Election, margin erosion & prospect of rate rises - high divis are reality against backdrop of robust house building demand

** Richard Watts, who runs Old Mutual Global Investors' UK Mid Cap Fund, sees scope for cash returns "well, well above what the market expects"

** Galliford Try (LSE: GFRD.L - news) & Redrow divi hikes spurred big on-the-day gains

** Watts holds Barratt Developments (LSE: BDEV.L - news) ; says co uses balance sheet more efficiently than many peers. Co runs c.4-yr landbank & it does not pay for much land until gets planning permission, meaning higher ROCE & cash returns

** Also holds Taylor Wimpey (LSE: TW.L - news)

** Notes choice between growth & cash back potential; e.g. Bellway (LSE: BWY.L - news) , Bovis & Redrow build more houses but then have to reinvest cash to drive volumes

** George Godber, manager of CF Miton UK Value Opportunities Fund, holds Taylor Wimpey, Barratt & Bellway, trade on 12-mth fwd PE SmartEstimates of 9.7, 10.1 & 8.6 times, StarMine shows

** Earnings next wk: Bovis Mon, Persimmon Tues, & Barratt Weds (RM (LSE: RM.L - news) : tricia.wright1.thomsonreuters.com@reuters.net)