Can you afford to miss this FTSE 100 ~8% yielder?

Thanks to its long record of brilliant earnings progression and its ability to throw out boatloads of cash, Barratt Developments(LSE: BDEV) has -- like many of its peers in the housebuilding sector -- proven to be a brilliant pick for income seekers in recent times.

It isn't difficult to see why investors are a little reluctant to plough into the likes of the FTSE 100 builder more recently, however, as recent datasets surrounding the British housing industry indicate a significant deterioration in trading conditions.

Latest figures from the Office for National Statistics last week showed average home values rising 4.4% during the year to February, to £225,000, down from the 4.7% rise of a month earlier and continuing the downtrend in property values that has been in force since the EU referendum. This figure is not hair-raising but underlines the belief that the vertiginous rises of previous decades now seem to be consigned to history.

Market strength

Now I'm not going to pretend that this difficult climate is not going to persist as slowing economic growth and ongoing political uncertainty dent homebuyer appetite.

But demand from first-time buyers remains pretty robust and this is allowing home prices to remain very well supported. A mixture of low mortgage rates and government support is keeping sales to new buyers bubbling nicely, and with a lack of existing properties entering the market, sales of new-build homes from the likes of Barratt are as a consequence still moving higher.

Indeed, details released by Rightmove last week showed that "interest in property remains robust," it said, the 142m visits registered on its website in March making it the busiest month ever for the property portal. It added that the number of first-time buyers seeking homes with two bedrooms or fewer was up 2.2% year-on-year last month.

Stunning yields

Latest trading details from Barratt highlighted this positive backdrop, the construction play announcing in February that the number of completions rose 2% in the six months to December, to 7,324 plots. And the release indicated that conditions have remained stable, as total forward sales had also risen 2% year-on-year, as of February 18, to £3.08bn.

The stratospheric home price rises may prove to be a thing of the past, but this does not mean the likes of Barratt will not keep on grinding out solid earnings growth. Far from it -- City analysts are actually predicting profits rises of 6% and 5% for the years to June 2018 and 2019 respectively.

This, allied with the Footsie firm's robust balance sheet, is expected to underpin additional dividend expansion. A 43.3p per share payout is predicted for fiscal 2018, up from 41.7p last year, and it is predicted to improve again next year to 44.9p.

Barratt subsequently sports eye-popping yields of 7.7% and 8% for fiscal 2018 and 2019 respectively. When you throw a super-low forward P/E ratio of 8.7 times into the bargain too, I reckon the housebuilder is an irresistible stock pick right now.

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Royston Wild owns shares in Barratt Developments. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.