Housebuilder Bellway has warned of an uncertain future for the housing market as global issues hit confidence among potential buyers. The Newcastle-based firm issued a trading update for the period from February to May, stating that previous guidance on profitability remained unchanged. Spring trading had improved compared to last autumn, but the company highlighted a slowing of customer demand in recent weeks, matched by its own caution in land buying. Reservations have fallen compared to the same period last year.
Cost pressures and management
Bellway added that it was experiencing increasing costs from some suppliers as fuel prices and other inflationary pressures weighed on companies. The firm stated it was “actively managing cost pressures through a combination of disciplined procurement, the introduction of new standard house types, and close control of site production and overheads.”
CEO statement
Chief executive Jason Honeyman said: "Bellway continues to perform robustly in an increasingly challenging market, with customer demand having moderated in recent weeks, after a positive start to the spring selling season. Notwithstanding this, and supported by our forward order book, we are on track to deliver FY26 underlying operating profit within the previously guided range of £320m - £330m."
He added: "The outlook beyond the current financial year remains uncertain, reflecting ongoing geopolitical tensions in the Middle East and a less predictable domestic political environment. Against this backdrop our clear focus on self-help and drive for capital efficiency provides resilience while supporting our strategy to increase cash generation and shareholder returns."
Reservation rates and order book
Bellway said its private reservation rate had decreased by 6.2% to an average of 151 per week, while its forward order book had also fallen slightly to 5,345 homes. The company noted that its land investment “remained disciplined and highly selective” and it was looking to add plots in areas of higher customer demand.
Share buyback and dividends
Despite pressures in its market, Bellway is continuing with a £150m share buyback programme launched last year and has increased its interim dividend. The update said: “We are reiterating our guidance for FY26 volume output of between 9,300 and 9,500 homes, and we remain on track to deliver FY26 underlying operating profit within the previously guided range of £320m - £330m.”
“Our industry continues to face challenging headwinds, increasing the risk of a more prolonged period of softer customer demand alongside renewed inflationary pressure on build costs. In response, we are maintaining a sharp focus on the monetisation of our well-invested land bank and work-in-progress position through FY26 and beyond to support improvements in asset turn and cash generation.”
