Bellway has seen its revenue drop by 30% to £2.38bn in the year to 31 July, as the housing market tries to see some improvement following the cut to the Bank of England base rate.

The number of completions by the housebuilder also dropped by 30.1% to 7,654 in this period, which has been attributed to a lower order book at the start of the year and "challenging trading conditions", particularly in its first half.

However, the firm noted that customer demand in the second half of its financial year increased, driven by a moderation of both mortgage interest rates and consumer price inflation, and an increase in wages.

Although Bellway also saw its profit before tax drop by almost half to £226.1m, it stated that this was in line with expectations.

Group chief executive at Bellway, Jason Honeyman, said: "Bellway has delivered another resilient performance despite the challenging operating conditions during the year. While a lower order book at the beginning of the financial year drove the reduction in the number of housing completions, customer demand through the second half benefitted from a moderation in mortgage interest rates which has eased affordability pressures and supported an increase in reservations.

"The combination of these improving trading conditions and our strong outlet opening programme has generated a healthy increase in the year end order book."

The firm said that the "combination of the improvement in trading and growth in outlet numbers" has increased in the forward order book in the 2024 financial year.

This comprised 5,144 homes, compared to 4,411 in 2023, with the order book value jumping by 18.4% year-on-year at 31 July, to £1.41bn.

Looking ahead, Bellway said that if market conditions remain stable, the group is targeting to deliver at least 8,500 homes in the current financial year, with volume output expected to be weighted towards the first half.

This comes as the housebuilder welcomed the new Government’s "plans to reform the planning system, which in time is expected to unlock land supply and support and increase in new housing across the country".

Investment director at AJ Bell, Russ Mould, said: "The stars are finally aligning for the housebuilding sector. The new Government has pro-housing policies with a promise to relax the planning system which has caused hold-ups and headaches in recent years; interest rates are coming down which makes mortgages more affordable; and property prices are strengthening. It’s no wonder that Bellway is so optimistic despite reporting a drop in profits."

He added that Bellway is "sitting on a big bank of land", which should underpin future profits and with the public growing more interest in buying its homes, this is "encouraging for the business".

Despite this, Mould concluded: "There is still a lot more work to do before it can truly be sitting pretty. Margins were hit over the past year and it needs to rebuild them. It also needs to improve the returns on the money it spends."

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