Residential property developer, Bellway, has said that it has seen strong underlying demand for new homes since the start of its financial year and expects housing completions to increase 25% for its full year.
However, at the same time, the recent national lockdown and transition to the new Help to Buy scheme have impacted recent reservation levels.
Reporting the period from August 1 to November 29 2020, the housebuilder said that its reservation rate increased 6% to 210 per week against the equivalent period last year.
Bellway said sales rates were “more pronounced” at the start of the financial year, driven by pent-up demand from the spring lockdown. The second lockdown of November slowed reservations to an average of 164 per week, 30% down on the same period in 2019. The firm stated that sales were “still resilient” during the lockdown period.
And the transition to new Help to Buy regulations had caused a “short term hiatus in the availability of the scheme,” producing a “moderating effect” on Bellway’s reservation rate in recent weeks.
Bellway said its order book was “substantial”, increasing 18.7% to £1,766.7 million against November 2019 and representing 6,186 homes.
With its board being “cautiously optimistic”, Bellway expects housing completions for FY 2021 to grow 25% from the 7,522 of July 31 2020, “providing a solid platform for continued growth thereafter, subject to continuing market demand”.
And for its half-year ending January 31 2021, Bellway expects the number of homes sold to be similar to the previous year (January 31 2020: 5,321).
The business noted longer-term risks, including the changes to Help to Buy and stamp duty, ongoing economic uncertainty and the end of the Brexit transition period.
Jason Honeyman, Bellway’s CEO, said: “Bellway is in a robust position and notwithstanding the recent widespread ‘lockdown’ restrictions throughout the country, sales demand is encouraging, and the order book is strong.
“We have substantial cash resources, considerable ability to continue investing in land and with our solid operational structure, we are determined to return the group to its strategy of delivering long-term and sustainable growth.”