Housebuilder Bellway has seen cancellation rates fall from 18% to more normal levels of 14%, which it attributed to “the improvement in affordability during the year and the relative stability in mortgage interest rates since January”.
In its trading update, Bellway said its forward order book had increased as of 31 July to 5,144 homes, up from 4,411 homes last year. It said this reflected the improvement in trading.
The value of these homes came to £1.14bn, up from £1.19bn previously.
Bellway said the government’s plans to reform planning would support the delivery of more homes and said if market conditions stayed stable, its strengthened forward order book and outlet opening programme would help the firm return to growth in 2025.
Its private reservation rate was also 13.8% higher than the previous year, at an average of 124 per week. Again, the firm put this down to stronger demand and a rise in outlet numbers.
For the year ending 31 July, the housebuilder delivered 7,654 homes, lower than the 10,945 completions the year before. These sold for an average of £308,000, slightly down on 2023’s £310,306, both of which Bellway said were ahead of previous guidance.
It generated a housing revenue of £2.35bn, down from £3.39bn last year, and said its underlying operating margin was expected to fall annually from 16% to 10%.
A ‘resilient performance’ for Bellway
Jason Honeyman, group chief executive of Bellway, said: “Bellway has delivered another resilient performance despite the continuation of challenging operating conditions during the year. This result has been achieved due to the dedication of our colleagues, subcontractors and supply chain partners.
“While a lower starting forward order book drove a reduction in volume output, customer demand during the year has benefitted from a moderation in mortgage interest rates, which has helped to ease affordability constraints and supported an increase in reservations. The improving trading backdrop, combined with the strength of our outlet opening programme, has generated healthy growth in the year-end order book.
“As a result, we are in a strong position to return to growth in financial year 2025, as previously guided.”
He added: “We are encouraged by the new government’s plans to increase the supply of new homes across the country and welcome its plans to reform the planning system.
“Overall, the long-term housing market fundamentals are positive, and we remain confident that our robust balance sheet and operational strength, combined with the depth and quality of our land bank, will enable Bellway to successfully capitalise on future growth opportunities.”
Shekina is the deputy editor at Mortgage Solutions and commercial editor at Mortgage Solutions and Specialist Lending Solutions. She has nearly eight years of experience in the B2B publishing market, having previously covered the hospitality, retail, pet, accounting and jewellery sectors.
Shekina has worked for Mortgage Solutions and Specialist Lending Solutions for almost five years. Here, she covers the market’s breaking news stories, engages with professionals in the sector, and oversees any commercially agreed content in partnership with mortgage-related companies.
This includes presenting webinars and hosting roundtable discussions on developing themes in the mortgage sector.
She is an NCTJ-trained journalist and was nominated for the Headline Money Awards Mortgage Journalist of the Year in 2021.
In her spare time, Shekina likes to read, travel, listen to music and socialise with friends.
She currently reports on current events in the mortgage market and liaises with financial clients to produce sponsored content.
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