Bellway profits jump on robust London growth

 
Kasmira Jefford
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HOUSEBUILDER Bellway has said profits before tax more than doubled in the first half of the year as higher selling prices and a strong demand for homes in the south continued to underpin growth.

The company, which operates from over 200 sales outlets in the UK, reported a 69 per cent rise in pre-tax profit to £40.6m in the six months to the end of January.

The group said its performance was “more robust” in the south of England, where selling prices rose by 9.8 per cent to £211,378 and the number of sales increased by 11.9 per cent.

Demand was strongest within the Greater London boroughs.

Home sales in the north declined one per cent while selling prices rose 4.3 per cent to £151,468, mainly due to a move away from flats in favour of more traditional two-storey houses.

Like other housebuilders, Bellway has increased its margins by selling more homes on land acquired at cheaper prices after the downturn.

Overall, Bellway sold 2,455 homes in the first half of the year – up 5.3 per cent on the same period last year – while the average selling price climbed 8.5 per cent to around £183,000.

The group warned that the supply of affordable mortgage products “so far remained restricted” but it is hopeful that the government’s NewBuy scheme will help drive future sales rates.

“This is unlikely to have any significant effect on the number of completions for the current financial year,” the company said.

Bellway also upped its interim dividend to 6p from 3.7p a year earlier.