Bellway to post 27% surge in revenue

The Group said cheaper mortgages and Help to Buy have helped buoy buyer sentiment August 5, 2016 / Isla MacFarlane
Bellway to post 27% surge in revenue

Housing revenue is expected to increase by £2.2 billion from £1,735.1 million in 2015, the housebuilder said in a trading statement.

“The Group has delivered an outstanding trading performance, achieving new records for Bellway in respect of both volume and operating margin,” Ted Ayres, Chief Executive of Bellway, said. “It is still too early to assess the effect of the EU referendum result, however trading in recent weeks has been encouraging and Bellway, with its strong balance sheet and robust land bank, can be flexible and respond opportunistically to any changes in market conditions.”

The EU Referendum aside, the Bellway reported that overall sentiment has been positive, buoyed by low interest rates and the continued presence of Help to Buy, contributing to good availability of affordable mortgages. The Group has taken an average of 169 reservations per week, an increase of over 10% compared to last year.

Bellway said there has been some “modest caution” around developments at the higher value end of the London market, where Bellway only limited exposure, but overall visitor numbers strong and the cancellation rate remains at a historic low.

The Group completed the sale of 8,721 homes, an increase of 12.5% compared to last year’s record. The average selling price of completions rose by almost 13% to £252,700, influenced in part by a lower proportion of social housing completions, which represented 16% of the total.

Bellway concluded that while it is too early to gauge the impact that the EU referendum may have on longer term customer confidence, the underlying demand for new homes remains strong, supported by lenders’ willingness to provide ongoing access to affordable mortgage finance.

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