Bellway is the second major housebuilding firm to post news of a substantial increase in profits, Clear Property Investment has learned.

The news that the firm is set to enjoy a 20 per cent rise in half-year profits follows on from that of fellow firm Berkeley who recently announced an 18 per cent rise in pre-tax profits, together with a 20 per cent increase in sales.

Bellway bosses attribute their own profits rise to consumer confidence in the light of the government's recent Spending Review announcement. They said people had started to purchase homes towards the end of the year, during autumn and early winter - a period they would normally expect to be much quieter.

Earlier this year the company's Finance Director Alistair Leitch was quoted as saying he believed spending cuts could have an impact: "The Scottish market has already been through one phase of job uncertainty with Royal Bank of Scotland and HBOS.

"It will be interesting to see what the level of cuts are vis a vis Scotland and that will have a big effect on what things are."

The effects it seems aren't as dramatic as he'd feared with Bellway now expecting the number of properties sold in the last six months to January 31 to be more or less equal to its previous year's figure. The firm has moved away from the first-time buyer market and is concentrating on the next rung up of family-type homes with its average sale price now sitting at £167,600.

The firm's Scottish interests include developments in Glasgow East, Dalkeith and Callander. It reckons it will have around 200 sites for sale in the New Year. So far it's purchased 1260 plots since September.  It warns though that sales are dependent on a loosening of current mortgage restrictions.

Meanwhile, several of the UK's biggest housebuilders have announced increases. Barratt, Taylor Wimpey and Persimmon all quoted sales rises of 10 per cent.

Analyst Jeremy Cave of MF Global Securities said: "It will give a bit of confidence that things are less bad than expected, but, in reality, these share prices are where they were a couple of months ago."

For more information on the recovery of the construction industry, buy-to-let and property investing in general please contact any of our Clear Property Investment team.

 

 

 

 

 

 

 

 

 

 

 

 

 

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