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Record year for North-East housebuilder Bellway
NORTH-EAST housebuilder Bellway has reported a record year for sales amid few signs that the property market has slowed in the face of new mortgage rules.
The Newcastle-based company said it sold 6,851 homes in the year to July 31, a rise of 21 per cent while average selling prices lifted 10 per cent to £213,000.
The group said it had seen little effect of recent interventions to calm the housing market as it posted record housing revenues up 33 per cent to £1.5bn.
It added that its forward order book jumped 36 per cent to £924.3m, while spending on new plots lifted by more than half to £460m, both of which were also records for the firm.
Bellway said its divisions in all parts of the country performed well, but business in the London boroughs was particularly good, with sales lifting 42 per cent to 1,236 homes during the period.
The Mortgage Market Review (MMR) introduced strict affordability tests on borrowers in April in order to avoid a housing bubble.
This was followed by Bank of England measures in June which ruled that lenders must ensure no more than 15 per cent of new mortgages are given to people borrowing more than 4.5 times their income.
Lenders will also have to stress test borrowers' ability to repay loans if their mortgage rate were 3 per cent higher than the rate at the time the loan was approved.
Bellway welcomed these moves as a way to "ensure a long-term sustainable supply of mortgage finance."
But it added that apart from minor delays on mortgage applications, the MMR has so far "not had a material effect on the reservation rate".
Chief executive Ted Ayres said: "The group has reacted positively to the continued strength of the UK housing market, significantly increasing output to satisfy customer demand."
Brokers at Panmure Gordon said Bellway had shown "good levels of growth in volumes, average selling prices and forward sales."