HOUSEBUILDER Bellway has posted a 57% rise in profits after business was boosted by a combination of demand for bigger houses, a more stable market and Government incentives.
The Newcastle-based company was also boosted by strong demand from the South, where average selling prices rose above £200,000 for the first time driven by second-time buyers moving into larger properties.
Bellway’s turnover rose to £1,004.2m in the year to July 31, from £886.1m, while pre-tax profits leapt by 57% to £105.3m.
The number of homes sold increased to 5,226 from 4,922 and the average selling price increased to £186,648 from £175,613.
It is the third successive year the company has increased its volume, average selling price and margins, despite the UK again plunging into recession.
John Watson, who will move over from chief executive to chairman early next year, said: “It’s just down to the business being well-financed and being able to buy some good opportunistic pieces of land. More than 50% of these plots are on land we bought since the downturn.”
He said Bellway was now building more houses rather than apartments, which has increased profitability.
“We’ve moved position over the last few years. In the South, the average selling prices is over £200,000 – it’s the highest it’s ever been, even pre-crash.
“We are now selling more three and four-bedroom houses – this is why, it’s not house price inflation.” The business has a strong presence in and around London, where a Bellway apartment sells for around £250,000, seen as the affordable end of the market in the capital.