Bellway Boosts Homebuilding Forecast Amid Surging UK Housing Demand
British homebuilder Bellway has raised its full-year homebuilding forecast to 8,600-8,700 homes, driven by a surge in spring sales and improved consumer demand.
BellwayUk HomebuildersBritainHousing MarketHome SalesReal Estate NewsJun 11, 2025
Home sales in Britain have picked up recently ahead of the April 1 expiry of temporary tax incentives for affordable and first-time buyers, further supported by gradual interest rate cuts. Data released on Tuesday showed that UK pay growth slowed and unemployment rose to a four-year high in the three months to April, which could pave the way for more rate cuts.
'Ultimately, lower rates in the UK should lead to lower mortgage rates and better affordability in the housing market, a key factor in the ultimate recovery in the sector,' said Colin Sheridan, an analyst at Davy. Shares of rival homebuilders Persimmon, Barratt Redrow, Taylor Wimpey, and Berkeley Group were up between 1.8 and 4%.
Government efforts to boost housing supply, including a £2 billion pledge for 18,000 affordable homes, have raised optimism in the sector. However, builders remain concerned about the impact of a building safety levy, which has now been delayed until late 2026.
Bellway constructs a wide range of properties, from one-bedroom apartments to six-bedroom family homes and luxury penthouses. The company now expects an average selling price of around £315,000 this financial year, up from a previous forecast of £310,000, as the final quarter will include a higher proportion of private completions. Its forward order book, an indicator of near-term demand, was up 7.7% year-on-year to 5,759 homes as of June 1.
In contrast, Bellway's larger rival, Persimmon, expressed caution last month about how economic uncertainty could affect affordability and demand. Despite this, the overall outlook for the UK housing market remains positive, driven by government initiatives and improved consumer confidence.
Frequently Asked Questions
Why did Bellway increase its homebuilding forecast?
Bellway increased its homebuilding forecast to 8,600-8,700 homes due to stronger spring sales and improved customer demand, driven by temporary tax incentives and gradual interest rate cuts.
What impact have interest rate cuts had on the UK housing market?
Interest rate cuts have led to lower mortgage rates, improving affordability and boosting demand in the UK housing market.
What government initiatives are supporting the UK housing market?
The UK government has pledged £2 billion for 18,000 affordable homes, which has raised optimism in the housing sector, despite concerns over a building safety levy.
How has Bellway's stock performed following the forecast increase?
Bellway's shares rose about 5% after the company announced it was sold out for the year and expected to build 20% more homes in the current and next fiscal years.
What is the current state of unemployment in the UK and how might it affect the housing market?
Unemployment in the UK rose to a four-year high in the three months to April, which could potentially affect affordability and demand in the housing market, though lower interest rates are expected to mitigate these impacts.
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