(Bloomberg) -- Bellway Plc is the latest homebuilder to note signs of improvement in the UK housing market after years of declining sales.
Bellway’s private reservation rate averaged 0.58 per outlet per week in the six months through July, compared with 0.43 in the six months prior, according to a statement Tuesday. The builder said its overall average selling price is anticipated to be around £310,000 ($404,519) in the 2025 financial year, up from £307,909 in the 2024 financial year.
“Customer demand through the second half benefitted from a moderation in mortgage interest rates which has eased affordability pressures and supported an increase in reservations,” Chief Executive Officer Jason Honeyman said in the statement.
Stubbornly high interest rates and construction costs have limited the amount of homes built by the UK’s biggest developers in recent years. The sector has shown signs of rebound as borrowing costs eased following central bank rate cuts and fresh political promises to boost housebuilding.
Bellway’s focus on mid-market homes made it more accessible to a wider group of buyers during the downturn, according to a Bloomberg Intelligence report published this summer. The company’s larger share of apartments compared with rival builders may prove advantageous as higher mortgage rates and the cost-of-living crisis push buyers toward smaller homes, the research said.
The company said the planning system remained “fraught with delays,” reducing the level of land buying during the year. However, it praised the government’s plans to reform the system, and said it expected the move to support an increase in new housing supply.
Its forward order book comprised 5,109 homes on Sept. 29, up from 4,636 roughly a year earlier. Still, the company’s total revenue dropped 30% to £2.38 billion due to challenging trading conditions, particularly in the first half of the financial year, compared with the Bloomberg consensus estimate of £2.34 billion. It’s proposed a 54 pence dividend, beating the 50.3 pence estimate.
Bellway’s decision to abort its pursuit of rival Crest Nicholson Holdings Plc led to costs of £5.4 million, according to the statement. The company said in August it had decided against the deal, just about a month after making a £700 million bid.
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