Bellway buoyant despite slowdown in house price growth and rising costs
Housebuilder Bellway has reported a rise in sales in the past four months, but reiterated industry concerns over a slowdown in house price growth and rising costs.
It said sales in the four months to June 2 were up on the back of healthy demand, buoyed by high levels of employment and low interest rates.
It saw reservations rise 4.7% to 244 a week, while its forward order book increased 2.7% to 6,312 homes.
The listed company said that, while house prices have remained firm, price growth has weakened over the period.
Bellway also followed industry rivals in warning that build costs have continued to rise throughout 2019.
While the company’s order book has risen on a number-of-homes basis, it also flagged that the total value of orders has sunk to £1.64 billion, down from £1.7 billion over the same period last year, amid planned growth for lower-value properties.
Demand has stayed strong over the start of the year due to high employment, low interest rates and the continued availability of Help to Buy, it said.
The firm’s weekly reservation rate has seen an “encouraging increase” following a positive spring selling season, it added.
Bellway also purchased more land over the past 10 months, acquiring 10,620 plots, up from 8,942 over the same period last year.
Chief executive James Honeyman said: “This has been another successful trading period for the group, during which we have made further disciplined investment in order to grow the number of sales outlets and build upon last year’s strong trading performance.
“Going forward, we are on track to deliver further earnings growth this financial year and beyond that, our strong balance sheet ensures that Bellway is in a good position to continue its long-term growth strategy.”