Partner Article

Housebuilder takes note of North/South divide

A leading Newcastle-based housebuilder has said the housing market’s “return to health” is experiencing a North/South divide.

The Bellway Group said its southern branches experienced a marginally stronger market, with turnover expected to be “much higher” than the North by the end of the year.

Bellway, one of the largest housebuilders in the country, said the markets in the Midlands, Yorkshire and North West England remain “fragile”.

In a statement released by the group they said: “The focus of the business is changing from primarily one of simple debt reduction to selectively increasing production in certain parts of the country where demand is strongest.

“The summer selling season normally heralds a slowdown in activity and selling homes in the early stages of construction is difficult, given the current lending environment.”

The firm said their incentive schemes - such as cash discounts, part exchange and shared equity - were still widely used but not on the increase, lending to continuity in prices.

Bellway, who have sold more than 100,000 homes since it was formed in 1946, expects to reach its 4,200 sales target for this year, averaging 105 a week since 1 February.

But it is still cautious of historically high cancellation rates as buyers struggle to get mortgages and lenders’ valuations were “inconsistent”.

The group revealed in March that average property prices had slumped by 11% to £156,100 in the first half, while it sold 1,200 homes less than a year ago.

This was posted in Bdaily's Members' News section by Ruth Mitchell .