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Builder eyes major housebuilding growth

Builder eyes major housebuilding growth

Construction firm Bellway has shrugged off concerns over Brexit to post record profits, and has said it hopes to build 11,000 new homes in the next year.

The company has unveiled its results for the year ending July 2016, which saw record pre-tax profits of nearly £500 million, up 40 per cent based on a 27 per cent jump in revenues to £2.24 million.

Moreover, in the first nine weeks since the start of August, the company took 162 reservations per week, a nine per cent rise on the 149 per week seen in the equivalent period of 2015.

The rise in profits was aided by the £17 million sale of the Barking Riverside site in east London and a 13 per cent rise in sale prices, but it was also the result of more homes being constructed to start with, as the company completed 8.721 homes - a 13 per cent jump on last year.

Commenting on the company's situation, chief executive Ted Ayres said: "The extent of volume growth this year will depend on whether customer confidence is maintained and strong sales rates continue throughout the autumn and subsequent spring selling seasons.

"From its structure of 19 operating divisions, the group has the capacity to deliver around 11,000 new homes per annum and is well placed to increase this capacity through the opening of further new divisions, should market conditions remain robust.”

Mr Ayres noted one problem was a shortage of skilled labour in some areas, notably around London and the south-east, where bricklayers are in short supply.

While the sector appears to be capable of generating more jobs as demand for new homes continues to be high, the question of whether Brexit will affect the ability of construction firms to hire workers from overseas when skills are in short supply still needs to be answered.

Balfour Beatty raised the issue in a paper published today (October 18th) titled A Vision For Growth warning that an exodus of EU workers could leave major shortages, not least for large infrastructure projects such as HS2 and Hinckley.

Image: iStock

 

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