On Tuesday, British housebuilder Bellway Plc (BWY.L) expressed growing worries about a slowdown in demand as mortgage rates continue to rise and overall cost-of-living pressures suppress

the housing sector.

The prospects of the Bank of England implementing further interest rate hikes have dampened hopes of a robust recovery in the UK housing market. After a smaller-than-expected decline in April's inflation rate, some lenders had to restrain or reprice their mortgage offers.

Moody's, the credit ratings agency, issued a warning last week, predicting a 10% drop in British house prices over the next two years. Additionally, the number of approved home loans in April decreased compared to the previous month, indicating that the early signs of housing market recovery in early 2023 are fading away.

Bellway highlighted that the expiration of the Help-to-Buy scheme in England has led to a decline in demand from first-time buyers when compared to the previous year. Moreover, there is a relative shortage of affordable mortgage products with higher loan-to-value ratios.

During the trading period from February 1 to June 4, the FTSE 250 company experienced a lower reservation rate, resulting in a diminished forward order book of £1.71 billion ($2.14 billion), compared to £2.40 billion in the previous year.

Last week, Crest Nicholson (CRST.L), a midcap peer of Bellway, also expressed concerns about a further slowdown in the housing sector.