Thursday, Nov 20, 2008
UK Government remains firmly in touch with reality
mortgagestrategy: Beckett calls for house builders to keep building
Housing minister Margaret Beckett is urging the house building sector to remain on task and continue building in the face of the economic downturn....................
Posted by jack c @ 03:13 PM (770 views) Add Comment
13 Comments
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1. renting2 said...
More bunker mentallity. Push meaningless pieces around a fictitious map. And then blame the 'people' for not rising to the challenge.
2. phdinbubbles said...
"Housing minister Margaret Beckett is urging the house building sector to remain on task and continue building in the face of ......."
Reality?
3. renting2 said...
See the FTSE's taken another pounding today. The markets are abviously not in touch with Beckett's reality.
4. Watchingthewheels2 said...
What's happened to the 'reality' of supply and demand.
5. jack c said...
Barratt Developments
price change % 52 wk-h 52 wk-l
59.75 4.75 7.36 508.50 39.00
6. stillthinking said...
This is meaningless nonsense. The housebuilders have costs which change with inflation i.e. raw materials and labour. The other costs are planning permission and most importantly the price of land.
When we all go on about the house price crash, we are really going on about the price of land crashing. The reason why the builders stop is because in a market with declining land value, they cannot buy land early and then sell the land later with a house on top, because the loss in value of the land knocks out any profit they make.
The housebuilders are a casualty of delaying the discovery of the bottom. If we want more houses then we need an accurate price discovery for UK land. We won't get that because the government is interfering and attempting to hold up values.
There is a housing shortage now and it will be worse in the future.
7. Old_traveller said...
Well, on the positive side it seems she is trying to do what she thinks best to avoid the next bubble (i.e. scarciity of resources to build = HPI so she seems interested in maintainig capacity).
But this might be at odds with all HPCers ideally wishing to buy at the trough followed by the mother of all booms due to scarcity and then sell at peak!
8. phdinbubbles said...
9. Kruador said...
I think something we've all learned over the last year is that conventional wisdom is commonly wrong. I don't believe there are too few houses - I believe there may well be about the right number. Targets of a few thousand extra homes on a base of 18 million *in England* are drops in the ocean in any case. That housing figure comes from HBOS' Empty Homes release on 1 November, at http://www.hbosplc.com/media/pressreleases/articles/halifax/2008-11-01-Morethanaq.asp?section=Halifax. There are 280,000 empty private homes. (Why anyone thought building new homes in Liverpool was a good idea, when it had 7% already standing empty in April 2007, is anyone's guess.)
I bet a lot of you believe that more houses are needed for more households due to divorces. The figures at http://www.statistics.gov.uk/downloads/theme_population/PT133_part2.pdf state a net 127,000 more marriages than divorces in 2006 (marriage numbers provisional). (See Table 2.1 on page 47). Because these are required to be registered these are actual counts rather than estimates.
Surely there's a net migration of people to London? Well, according to http://www.statistics.gov.uk/downloads/theme_population/PT133_part3.pdf, there's been a net migration of over 60,000 people a year *away* from London in every one of the last seven years (nearly 120,000 in 2004).
10. alan said...
"He says: “It is absolutely essential that we learn the lessons of the past. In previous economic downturns, housebuilders and developers have been hit quickly and sharply but recovery has been slow and difficult.“This time the ministry wants to work with the industry to maintain capacity so that it is ready and able to respond when the upturn comes. In particular we need to work together on investment, training and skills to attract and retain talented people.”
OK. So who buys all these new houses and for how much? Or are the housebuilders going to "stockpile" them?
Just a few minor problems over working capital, then?
I thought Raynsford was brighter than this?
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