Bellway shares fall on housing fears

Bellway, one of the U.K.'s leading housebuilders, has today announced profits of £44.4 million for the year ended July 2010 compared to a £29.8 million loss last year. However, shares in the company are down 5% in early trading amid concerns that after the traditional summer lull the housing market has yet to see a marked pickup in business levels.

There is no doubt that the UK housebuilding sector has been through a traumatic two years post the credit crunch and economic downturn. However, only a few months ago there were signs of a recovery in the sector but talk of a downturn in the UK economy, further austerity measures by the UK government and difficulties within the mortgage market have all come at the worst possible time.

Bellway had originally intended to increase volumes by 10% for the current year although many analysts believe this figure is now under serious threat. It will be interesting to see how other housebuilders in the UK have performed during these very difficult and challenging times and indeed whether the drop in volumes is a sign of the future or perhaps just a glitch. The UK housebuilding sector is very important to the UK economy and the UK population.