BUILDER Bellway saw a rise in house prices and the number of properties it sold as the market continues to rebound.
The Newcastle company is “going in the right direction”, according to the housebuilder’s new chief executive Ted Ayres, who took over the reins from the now chairman John Watson at the start of the month.
And he said the business was in a “reasonable place” as he announced a trading update for the six months to January 31, which showed a rise in house sales and average selling price.
Bellway sold 2,597 homes, an increase of 5.8%, at an average of £187,000, 2.3% higher than the previous year, during the period. The company expects the average selling price to continue rising for the rest of its financial year.
Ayres said: “We are quite pleased with the numbers. The early indications after Christmas are that sales have picked up with seasonal trends.
“It looks as if it is going in the right direction. It feels as if we are in a reasonable place.”
Following the recent pattern, London and the South East is doing well, as are Scotland and Yorkshire where some new sites have opened.
Ayres, who moved into the top job after working as Bellway’s operations director, said the picture was not so strong in Wales and parts of the Midlands but the North East market was ticking off nicely.
“The North East always seems to do well for Bellway. The public in the North East tend to know the Bellway brand,” he said.
“Once you get into central London, it seems to be a market within a market. We’ve built a niche of building affordable flats and we have 25 outlets in and around central London. We are not at the top end of the London market, we are at the affordable end.
“There is a better feeling about job security and the bank of mum and dad is more prevalent down there. But there’s still that fragility in the macro environment.”
Government schemes to help first- time buyers on to the housing ladder played a key role in increasing the reservation rate. The NewBuy and MI New Home mortgage indemnity schemes accounted for 11% of reservations.
Bellway’s order book stood at 2,467 units at the end of January – 82% of the group’s full-year target.
“The board expects to achieve volume growth of around 5% in the current financial year, assuming reservations over the spring selling season following their usual upward trend,” Bellway said.
“The group is therefore well placed to deliver further growth in profit and shareholder return through its continuing strategy of growth in volume, average selling price and operating margin.”