This one has come back sharply recently (15% or so in a month) despite good results, presumably on profit taking and some worries about the development of a bubble in the UK housing market. While this may be the case in London, it seems to me that the market is now starting to broaden out further away from London.
This was confirmed by a survey of estate agents and surveyors from Hometrack yesterday, which showed demand still outstripping supply and prices continuing to rise.
Now while this is not good for everyone, it should be good for national house builders like Bellway (BWY), so I have used this as an opportunity to add to my holding. it is looking over sold but is currently below its 200 day moving average. It is also still cum the interim dividend of 16 pence which gives a yield of just over 1% and it is forecast to pay a dividend which will represent a yield of just over 3%, 3x covered and they have little if any debt.
I think it should still be well supported operationally by the broadening out of the housing market and price rises more generally. Interest rate rises still seem to be off the agenda until next year at the earliest, although new tougher mortgage applications could I guess put a dampener on demand in the short term. In addition as I have written about before the sector should also continue to benefit from the governments Help to Buy Scheme being extended out to 2020.