Profits at housebuilder Bellway have tumbled by more than half for the past year after lower orders for new homes in the face of challenging market conditions.

However, the Newcastle-based firm said it expects to complete more homes this year as easing mortgage rates have helped support more demand.

Bellway said revenues and profits for the latest financial year were dented by more expensive mortgage rates.

Rates rocketed after interest rates were hiked to a peak of 5.25% – their highest for 15 years – and remained at this level until the first cut by the Bank of England in August this year.

On Tuesday, Bellway revealed that revenues fell by 30.1% to ￡2.38 billion for the year to July 31, compared with the previous year.

House constructions also dropped by 30.1% to 7,654 homes for the year, driven by a weak order book at the start of the year.

The firm’s pre-tax profits plunged by 62% to ￡183.7 million for the year.

Jason Honeyman, group chief executive of Bellway, said: “Bellway has delivered another resilient performance despite the challenging operating conditions during the year.

“While a lower order book at the beginning of the financial year drove the reduction in the number of housing completions, customer demand through the second half benefited from a moderation in mortgage interest rates which has eased affordability pressures and supported an increase in reservations.”

Bellway said customer demand has been “robust” over the start of the new financial year, with a further reduction in mortgage rates helping to drive a recovery in orders.

Its forward order book has increased to 5,144 homes from 4,411 homes at the same period of last year, Bellway said.

As a result, Bellway said it is targeting at least 8,500 house completions this financial year, which would be an 11% rise on the previous one.