Housebuilder Bellway has reported a notable dip in homebuyer interest during April and May, citing a sharp rise in mortgage rates as the primary cause.
The Newcastle-based company warned that the ongoing challenges could slow the broader recovery seen across the UK housing market in recent months.
Mortgage rates surged following the onset of the US-Israel war with Iran at the end of February, triggering significant financial uncertainty across global markets.
Many mortgage deals were pulled entirely during this period as lenders responded cautiously to the volatility created by the Middle East conflict.
Bellway said customer demand slowed considerably after what had initially been a positive start to the spring selling season for new homes.
Private reservations for new homes fell to 151 per week between February and May 29, compared with 161 per week during the same period in 2025.
Higher fuel and energy prices stemming from the conflict have also been pushing up the cost of building materials, adding further pressure to operations.
The company noted that some suppliers had introduced surcharges specifically to cover the increased costs associated with elevated energy prices.
Chief executive Jason Honeyman said: “Bellway continues to perform robustly in an increasingly challenging market, with customer demand having moderated in recent weeks, after a positive start to the spring selling season.”
Honeyman added: “The outlook beyond the current financial year remains uncertain, reflecting ongoing geopolitical tensions in the Middle East and a less predictable domestic political environment.”
Despite the headwinds, Bellway maintained its full-year target of building between 9,300 and 9,500 homes for the 2026 financial year ending in July.
That output would represent a meaningful increase from the 8,750 homes the company completed during the previous financial year.
Bellway also confirmed it was holding firm to earlier guidance on profitability, expecting to report an underlying operating profit of between £320 million and £330 million.
