Key facts
- Bellway warned the revived Help to Buy scheme could slow the housing market by causing buyers to delay decisions.
- The 'Your First Home' scheme offers first-time buyers a 20% equity loan with a 2.5% deposit.
- Customer demand is constrained by affordability pressures and high mortgage rates, according to Bellway.
- Bellway's housing completions rose 11% to 9,695 homes in the year to July.
- Revenue increased 14% to £3.2bn, and pre-tax profit rose 22% to £270m for Bellway in the same period.
Housebuilder Bellway has cautioned that the UK government's revived Help to Buy scheme, 'Your First Home', could lead some prospective buyers to delay purchasing decisions in the near term. The FTSE 250 company stated that while the scheme is a welcome development, the period before its launch might influence buyer timing amid ongoing affordability pressures and economic uncertainty.
Chief executive Jason Honeyman told shareholders on Tuesday that customer demand remains constrained by affordability pressures, with mortgage interest rates above prior-year levels, and wider economic uncertainty affecting homebuyer decision-making. The 'Your First Home' scheme will offer first-time buyers a 20% equity loan towards a 2.5% deposit, with an initial interest-free period.
British housebuilders have been calling for government intervention to boost housing affordability, particularly as soaring mortgage rates have deterred potential movers. Shares in London-listed housebuilders had previously surged following the announcement of the new scheme, though some economists have raised concerns about supply-side issues related to rising construction costs.
Despite the challenging market, Bellway reported a "robust" performance in the year to the end of July. The group's total housing completions grew by 11% to 9,695 homes, driving a 14% uplift in revenue to £3.2bn. Pre-tax profit jumped by 22% to £270m.