"Bellway has delivered a resilient performance against a backdrop of rising mortgage interest rates and challenging market conditions"
- Jason Honeyman - Bellway
The housebuilder has forecast that completions will drop to 7,500 for 2024, compared to the 10,945 achieved in 2023.
Reporting on its preliminary results for the year ending July 31 2023, housebuilder, Bellway said that its private reservation rate per site per week during the period had been 0.46 against 2022’s 0.70.
The overall reservation rate was 28.4% lower than the prior year at an average of 156 per week. Bellway said that during June and July, further rises in borrowing costs had dented consumer confidence and reservation rates throughout the summer. It added that the closure of two of its divisions would lead to a cut in staff of around 5%.
Bellway noted its reduced order book of 4,636 homes as of October 1 2023, compared to the 7,257 homes of a year before. Based on 2023’s average private reservation rate of 0.46, it said there would be a “material” reduction in volume output for the year ending July 2024.
However, it plans to end its current financial year with an improved order book (this was 4,411 homes in FY 2023) “to serve as a platform for a return to growth beyond the current financial year”.
Looking ahead, however, Bellway’s board noted a “wider than usual range of outcomes”, with completion levels dependent on the movement of mortgage interest rates “and the strength of demand in the autumn and spring selling seasons”.
Jason Honeyman, Bellway’s group CEO, said: “Bellway has delivered a resilient performance against a backdrop of rising mortgage interest rates and challenging market conditions.
“Looking ahead, our operational strength and experienced teams will enable the group to successfully navigate a changing market, and we will maintain a clear focus on delivering high-quality homes to our customers and making further progress against the priorities set out in our ‘Better with Bellway’ sustainability strategy.”
