London property market boosts Bellway after Made in Chelsea sale
Friday 13 December 2013
Housebuilder Bellway is capitalising on London's roaring property market after selling a clutch of Made in Chelsea expensive aparments.
The sales have pushed Bellway’s average selling price to £205,000 in for the first six months of the financial year. The firm completed the sale of 25 apartments at its Chelsea Reach scheme at an average price of more than £700,000 each during the period, boosting its sales by nearly £18 million.
Chief executive Ted Ayres, pictured, said two penthouses had fetched in excess of £1 million each.
The figures came amid more signs that the housebuilding industry is beginning to gear up to meet demand inspired by the Government’s Help to Buy scheme, with an 18 per cent rise in new orders between July and September compared to a year earlier.
More than half of the £2 billion increase in orders was down to new housing work. The industry gained £1.2 billion in new housing orders over the quarter, up 42 per cent on the previous year.
Total new housing orders are at their highest level since the end of 2007, the Office for National Statistics said. The ONS also said construction output had been stronger than initially thought in the first and third quarter of 2013, adding 0.1 percentage points to the overall economy’s growth in each quarter.
Bellway added that sales between August and the end of November had risen to an average of 144 per week — up 43 per cent compared to the same period last year.
The Government’s mortgage scheme is being used in almost a third of new sales reservations, the firm added.
Ayres said: “Sales rates are up quite significantly compared to last year... the next big challenge for the industry is constructing the units to meet the demand.”
Higher margins coming through from land bought at cheaper prices is expected to push operating profits up at least 15 per cent in the year to July 31, although Bellway has begun to see rising build costs.
“We have seen a 2-3per cent in tender costs from subcontractors in the past few months and I don’t see that abating,” Ayres added.
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