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Bellway sales up 5pc

Housebuilder Bellway has increased sales by five per cent in the six months to 31 January 2012.

The company completed on 2,455 homes in the period, compared to 2,332 in equivalent period in 2010.

The increase was driven by a surge in private sales – up 15 per cent – which together with changes in mix has seen the average selling price climb 8.7 per cent to around £183,000.

Bellway predicts its average sales price will continue to rise this financial year but at a slower rate.

Operating margin is set to reach double digits for the six months to 31 January, up from 6.9 per cent in 2011.

The rate of improvement has now slowed buy the company predicts it will continue to grow.

Net debt currently stands at £12m after the group spent £105m on land and land creditors in the period.

It retains facilities of £300m which expire in tranches up to November 2016.

The group’s order book is now £423m compared to £402m in 2011 and it has now reserved or legally completed 83 per cent of this year’s target.

Since 1 August reservations have averaged around 89 per week from 205 sites compared to 80 per week from 185 sites last year.

Bellway said the increase has been achieved despite a reduction in the use of shared equity as an incentive to just 5 per cent of reservations taken.

A company statement said:  “The spring selling season is about to commence and last year provides a challenging comparison in terms of reservations.

“Nevertheless, with visitor levels up by around 20% since the beginning of January and with the

Government’s new `Mortgage Indemnity Guarantee’ scheme about to be launched, early indications are that the Housing market remains resilient. To what extent this resilience is sustainable can be better assessed at the end of March when the Group announces its Interim Results.”

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