Bellway sees lift in reservations and prices

Housebuilder Bellway today said it has seen a slight improvement in access to higher loan to value mortgage finance as it looked back over largely unchanged market conditions.

The Newcastle company said in the period from the start of August to the end of November, reservations, net of cancellations, rose to an average of 100 per week, an increase of 6% compared to the same period last year.

This growth in volume has been achieved from an average of 213 sites compared to 205 sites last year, it said.

The company said it continues to use a range of sales incentives to secure sales with NewBuy,  accounting for 10% of reservations taken in the period.

The average selling price of reservations, net of sales incentives, has increased by 4% to £195,800, reflecting continuing changes in product mix, it said.

The has group achieved 3,951 (2011 - 3,748) sales for the current financial year, representing 72% of its current annual target.

“The board anticipates that legal completions will increase by around 5% for the six months ending 31st January 2013 and expects that the operating margin for the same period will slightly exceed the 12.5% achieved in the second half of the previous financial year,” the firm said.

“The board continues to believe that improvements in shareholder return can be achieved through organic growth, given that land can be acquired where the return on capital is accretive to shareholder value.

“To that extent the group's land teams have been active, resulting in expenditure of £91m on land and land creditors and modest net bank debt of £77m at 30th November 2012. Given its balance sheet and operational capacity, the Group is well placed to deliver future sustainable and responsible growth.”