Bellway boss says end of Help to Buy must be handled carefully

Wed, 22 Mar 2017

Bellway boss says end of Help to Buy must be handled carefully
Bellway has warned the Government that they must find a way to "sensibly exit" the Help to Buy scheme, in order to help housebuilders.

Bellway's chief executive, Ted Ayres, confirmed that he had met with communities secretary Sajid Javid to discuss the end of the programme, which is due to end in 2021.

Part of the policy had been a mortgage guarantee, which had been created to encourage lenders to offer mortgages with deposits of as little as 5 per cent, however this ended late last year.

Bellway have released figures that show Help to Buy had been used in almost 35 per cent of the homes they sold in the last six months, which represented a rise of 6 per cent from the same period the previous year.

Mr Ayres said that he thought the Government had started to realise that it was necessary for plans to be made "sooner rather than later".

"We've got to look at an acceptable exit strategy in 2021 and [Mr Javid] realises that that has to be sooner rather than later because it will affect our land buying from 2018 onwards," he said.

However, he emphasised that he believed the housing market was strong enough to survive the withdrawal of assistance.

"It's been a positive move for the sector but we've got to the stage now where people are using Help to Buy even though their finances mean they don't need it, which gives us confidence that the demand is still there."

Pre-tax profits for the company had climbed 9.3 per cent in the six months to the end of January, to £247.6m, while revenue had become 5.9 per cent higher, at almost £1.15bn.

On top the increased profits, Bellway built 6.5 per cent more homes than the same period in the previous year, at 4,462.

The company were quick to allay and fears that people may have had regarding the UK's exit from the European Union, mostly due to its focus on homes in east London and around the capital.

Mr Ayres said his biggest concern was finding enough people to build homes. "The workforce isn't quite as elastic as the sales rate," he commented.

Anthony Codling, equity analyst at Jefferies, said: "Whilst some [housebuilders] have experienced growing pains, Bellway has delivered growth in volumes alongside improving customer service, and we expect to see more, in both, to come."
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