Bellway's prices up 19%

byJohn Leitch



Bellway's house prices jumped ahead by 19% in the six months to 31 January compared with the same period last year. Chief executive John Watson said this week that house price inflation on a like-for-like basis ran to 8%.

The 19% rise took Bellway's average price from £89,000 to £106,000. Watson said three other factors behind the improvement were a 5% increase in product size, specification enhancement and better locations.

The latest interim results showed turnover strongly ahead at £250m (£180m) and pre-tax profit higher at £30m (£21m). The operating margin was 13.2%, slightly up on the 13.0% figure last time. Asked if there was further improvement in the pipeline, Watson said: "Watch this space. Margins will improve in the second half."

Bellway is the UK's fifth-largest housebuilder. It has a national spread, with 40% of turnover coming from its three southern divisions.

For the past three years, over 60% of new Bellway houses have been built on brownfield land. "It reflects our history," said Watson. "We have taken on some complex schemes. The proportion of inner-city brownfield sites we develop will grow"

Watson said Bellway had recently bought inner-city sites in Manchester, Birmingham, Cardiff, Sheffield and Glasgow.

Bellway is trialling high-speed links with its subcontractors in the north-east region. "I want Bellway to embrace technology," said Watson. "We have a new software system in place for better customer care and we are now looking to introduce integrated WAP mobile telephones for communication purposes with our subcontractors."

The aim is that if the owner of a new property has a problem with plumbing in the kitchen at 8pm on a Friday night, a month after buying the house, for example, then a call on a dedicated line will automatically alert the plumber on his mobile. "We would then anticipate him calling back at 9pm to say the situation was resolved, details of his call being automatically downloaded onto our software," said Watson.