Bellway Homes sees some house price stability

Housebuilder Bellway said it has seen some stability in house prices, but has also identified a North/South divide emerging in the way the market is returning.

The group said its southern divisions had experienced a stronger market and turnover was expected to be "much higher" by the end of the year than in the North.Newcastle-based Bellway said markets in the Midlands, Yorkshire and North West England remain "fragile".

The firm said incentive schemes such as cash discounting, part exchange and shared equity were still widely used but were not on the increase, lending continuity to prices.

In a statement Bellway said."The focus of the business is changing from primarily one of simple debt reduction to selectively increasing production in certain parts of the country where demand is strongest."

Bellway said reservations since February 1 had continued to average 105 a week, which the firm said would secure its target of 4,200 homes sales this year and underpin its performance.

But the firm warned of historically high cancellation rates as prospective buyers struggled to get mortgages and lenders' valuations were "inconsistent".