Housebuilder Bellway sees boost from state scheme NewBuy
The company sold 2,597 homes in the six months to the end of January, marking a rise of 5.8pc on a year earlier, it said in a trading update.
The average selling price also rose, by 2.3pc to £187,000. Bellway said that was due to changes in the types of homes and where it builds, rather than a wider price lift across the housing market. The increase also does not take account of inflation, which has been running above the 2pc target, suggesting that “real” prices were flat.
Bellway said its margins continued to climb however, as it sells more homes built on land bought cheaply in the wake of the housing market downturn. The company said that its operating margin will pass12.5pc for the first six months of its financial year, compared to 10.1pc in 2012.
Like the rest of the sector, housebuilders are rebounding strongly, supported by land banks built up at depressed prices, as well as government initiatives to boost the economy through stimulating home building.
Bellway said demand for new homes is still “resilient” as it saw an average of 97 reservations a week in the last six months, a pick up on the rate of 89 a year earlier.
Bellway said this was driven by it opening more sales outlets, but said its performance had also received a boost from customers being able to obtain higher loan-to-value mortgages through the government-backed scheme NewBuy. Together with its Scottish equivalent MI New Home, NewBuy accounted for more than one in 10 of reservations taken.
Customers also used other initatives, Bellway said, although it noted that sales reservations through shared equity plans are falling, from 5pc a year ago to only 3pc.