HOUSEBUILDER Bellway has reported a 50% rise in profits as sales and prices recover in a market led by second- time buyers.

The Newcastle-based business – Britain’s fourth biggest housebuilder – said its annual turnover increased to £886.1m in the year to the end of July, from £768.3m in 2009/10. And this helped drive pre-tax profits up to £67.2m, from £44.4m a year earlier.

And the company also reported both higher sales numbers and house prices. Bellway sold 4,922 homes, compared to 4,595 a year ago, while the average price increased to £175,613 from £163,175.

Chief executive John Watson said: “It’s a good set of figures. It’s stabilised compared to two, three years ago when people were pulling out of transactions.

“For us, the model has changed from coming out of hibernation to let’s buy more land and bring more sales outlets to the market. It’s a lot better than it was – it’s not rip-roaring, it’s not back to where it was, but it’s a good steady market.”

Rather than the first-time buyers – once a mainstay stay of the market – growth is now coming from people looking to buy for a second or third time.

Watson said: “There is a large under-supply out there. There’s a shortage and there are people who can afford to move and need to move, rather than fancy moving – people downsizing, having kids or getting divorced.

“The first-time buyers aren’t there – we’re dealing with the second time buyers. In ’07/08, the first-time buyers would be a quarter/a third of sales. They have fallen away to half that level. In the main, they are renting.”