Housebuilder Bellway (BWY.L) has said it is building more homes amid “healthy” demand from buyers.

Shares in the company lifted on Tuesday after it told shareholders that profits have increased after it completed more houses.

The company is among developers to have been boosted by easing mortgage rates and the Labour Government’s ambition to build 1.5 million homes.

Newcastle-based Bellway said it delivered 4,755 homes in the half-year to January, up 12% against the same period a year earlier.

It reported “improved sales rates” as customer demand was supported by “good availability” of mortgage finance.

The company said it is therefore on track to deliver at least 8,500 homes in the current financial year.

Jason Honeyman, group chief executive of Bellway, said: “Bellway has delivered a strong first half performance with good growth in volume output and profits.

“Underlying demand for our homes is healthy and we have been encouraged by the improvement in customer inquiries and reservations since the start of the new calendar year.

“I am confident that, given our operational strengths and land bank depth, we remain very well-positioned to capitalise on the positive long-term fundamentals of the UK housebuilding industry, and Bellway will continue delivering the high-quality new homes the country needs.”

Oli Creasey, property analyst at Quilter Cheviot, said: “Bellway is clearly making progress in revenue growth, driven by increasing volumes.

“Achieving this growth through bulk orders is no bad thing, but management will need to focus on expanding margins. Both volumes and profit remain well below 2022 levels.

“While the company and the housebuilding industry are on the road to recovery, there is still a long way to go.”

Bellway shares were 2.5% higher after morning trading.

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