Housebuilder Bellway anticipates completing more homes this year as declining mortgage rates drive up demand.
The Newcastle-based company’s shares surged 6.4% in early trading after reporting that its forward order book increased to 5,144 homes, up from 4,411 homes during the same period last year.
Bellway is now aiming for at least 8,500 home completions this financial year, marking an 11% increase over the previous year.
Despite this, the company revealed that profits fell by more than half over the past year due to lower orders for new homes amid higher mortgage rates. Interest rates had spiked to 5.25%—a 15-year high—before the Bank of England made its first cut in August.
Revenues dropped by 30.1% to £2.4 billion for the year ending July 31, while house completions also fell by 30.1% to 7,654 homes, driven by a weak order book at the beginning of the year.
Pre-tax profits plummeted by 62% to £183.7 million for the year.
