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Valerius

South Of England Leads Housing Market Pick-up

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http://business.timesonline.co.uk/tol/busi...icle6440604.ece

So after a very good week, things are picking up nicely with housebuilders resuming work on stalled developments.

As I was saying a few months back, HPI would return mid-year. And it has.

Glad you lot have been proved wrong on this one. :P

Another missed boat... :lol::lol:

Valerius, I think the issue is that house builders think they may finally be able to sell, not that they will get a good price.

The recent news from Haliwide will cause the huge pent up supply to spill onto the market. It will be like one of those arcade games where you try and dislodge coins, suddenly a whole load will drop.

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Bellway Plc

http://www.bellwaycorporate.com/servlet/Hs...r_client_id=103

Since the announcement of the Group's Interim Results on 31 March, there has

been no major change in demand for our products. First time buyers continue to

struggle to raise deposits and consequently access to the first step on the

housing ladder remains difficult. Whilst conditions vary from region to region,

the southern based divisions have experienced a marginally stronger market and

it is envisaged that turnover in these divisions will be much higher by the

year end than the northern based divisions whose markets still remain fragile,

particularly in the Midlands, Yorkshire and North West England.

With entry to the mortgage market still restricted and lenders' valuation

policies remaining inconsistent, cancellation rates are still running at

historically high levels. Despite this, net reservations since 1 February have

continued to average 105 per week thereby securing the volume target of 4,200

homes, thus underpinning the Group's performance for the year. To achieve these

reservations, incentives in the form of cash discounting, part exchange and

shared equity are still widely used, but are not increasing as a percentage of

selling prices, therefore bringing some stability to our pricing structure. The

level of completed stock units has now reduced from 1,000 at the end of January

to 660 at 31 May.

With bank debt currently standing at GBP111.3 million, Bellway continues to

operate well within its committed facilities. The focus of the business is

changing from primarily one of simple debt reduction to selectively increasing

production in certain parts of the country where demand is strongest. In

addition, the Group has instructed its land teams to begin acquiring land

suitable for traditional two storey housing.

The summer selling season normally heralds a slow down in activity and selling

homes in the early stages of construction is difficult, given the current

lending environment. Nevertheless, our current order book of reservations for

completion after 31 July presently stands at GBP228 million (GBP283 million - 31

May 2008) and with a further 9 weeks of selling to go, the Board aims to have

50% of next year's volume target secured as it enters the new financial year.

Seems bearish to me.

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After the biggest housing boom in history they are 111 million in debt....i'd say technically speaking...they are f**ked.

Would you buy a house in a half finished estate knowing the developers owed 111 Million, i wouldnt.

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South Of England Leads Housing Market Pick-up, More Good News For The Housing Market

Spot on there Valerius.

The current bounce is 2006-2007 redux, as a whole lot of southerners with more money than sense buy grossly over valued assets as the rest of the country looks on aghast with horror.

And just like 2006-2007, when house prices in the North and Midlands plateaued or even declined, the silliness will be brought to a grinding halt by the laws of economics.

If find the determination of the more wealthy people in the South of England to reduce their average wealth down to match the rest of the country most commendable.

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"cancellation rates are still running at historically high levels."

yeah but, mr bear, interest is way up and approvals are too. we bulls are still working on the completion aspect, but it is only the end part of the process, and this will work through as the recovery, induced by QE and lenders lowering their criteria, works its way into the population.

Buy now before it all takes off again.

Edited by Bloo Loo

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As I was saying a few months back, HPI would return mid-year. And it has.

I too have been predicting that HPI would return at this time.

And then that it would be going away again from September onwards.

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Having read and re-read said article, I fail to see how it can be considered "bullish on house prices". What it appears to be saying is the government are paying builders to build because said builders can't build as they lack the money to do so, and the only way a housebuilder can make money is to build houses. If they don't build, ultimately they'll die.

The biggest housebuilders are applying for £320 million of government funding to resume work on stalled housing developments. Barratt, Persimmon and Taylor Wimpey will have completed their bids for a share of the cash before Monday's deadline

In essence, this strikes me as an admission of the sheer scale of the problem. The market clearly isn't healthy enough yet to support these companies operations on any kind of commercial basis, so the government are stepping in to keep them from going under.

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It's just them getting ready for next years 'New Build HomeBuy scheme'

http://www.direct.gov.uk/en/HomeAndCommuni...hemes/DG_066514

The New Build HomeBuyâ„¢ scheme could help you to buy a newly built property. You pay for a share of the cost of the property and pay rent on the remaining amount. Find out if you are eligible and how the scheme works.
New Build HomeBuy is open to households earning less than £60,000 a year who would otherwise be unable to buy a home.

Hahahahahha. Aw you poor would be home owner. Does you nasty boss only pay you £59,000 a year and you can't save a deposit because your rent's to high? Here let the government give you a cheap loan. Hahahahahahah!

This country has gone to rat shit. People live on $2 a day, we need £165 a day. FFS!

Edit : Spelling :-(

Edited by XswampyX

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Guest joeschmo

"Barratt said that it would use funding to restart work on a 700-home development in Bognor Regis, West Sussex,"

hope they can find 700 people who would want to live there :blink:

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"Barratt said that it would use funding to restart work on a 700-home development in Bognor Regis, West Sussex,"

hope they can find 700 people who would want to live there :blink:

You don't build houses to live in, they are investment vehicles. ;)

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After the biggest housing boom in history they are 111 million in debt....i'd say technically speaking...they are f**ked.

Would you buy a house in a half finished estate knowing the developers owed 111 Million, i wouldnt.

so would you buy a car from a retailer or manufacturer with debt. Or a TV, or a washing machine, or a pair of curtains, or a pair of pants.

Debt is the economic model - there is nothing wrong with your builder being in debt - debt is not the issue, it's cashflow. If they can service the debt, then what's the problem - but companies with no long term debt can go bust too - and they do, a lot. In fact, not carrying some debt might actually be a terrible thing for management to be doing right now.

Edited by Rachman

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Why, only this week on the BBC 6 o'clock news they were saying there might be the possibility of a recovery. One of their less factually based items I would suggest.

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South Of England Leads Housing Market Pick-up, More Good News For The Housing Market

Why are higher house prices good news?

Instead of enriching yourself by disenfranchsing FTBs why don't you create new businesses doing something useful like fighting climate change?

Edited by Dave Spart

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"Barratt said that it would use funding to restart work on a 700-home development in Bognor Regis, West Sussex,"

hope they can find 700 people who would want to live there :blink:

i think hes reffering to THE 700 homes that are in Bognar that were started by the Normans during their conquest but never completed.

obviously no one would build new homes in Bognar Regis in these modern times.

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Idiot. Go buy a house now, and eat your hat.

Relax. At this rate you will suffer an heart attack.

Activities picking up, more people back to work why is this not good news?

Oh I know why. You would prefer everything crash and burn to fit your sad existence?

You need seroius conselling.

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more people back to work why is this not good news?

I think you'll find that unemployment is going up, not down.

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I think you'll find that unemployment is going up, not down.

Yep it's only the rate they are going up, that's coming down? <_<

It's all the high paying jobs looking after holiday makers. 'Do you want fries with that?'

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http://business.timesonline.co.uk/tol/busi...icle6440604.ece

So after a very good week, things are picking up nicely with housebuilders resuming work on stalled developments.

South of England leads housing market pick-up

Catherine Boyle and Rebecca O'Connor

The North-South divide is increasing in the housing market, according to Bellway, one of the biggest housebuilders. The company said yesterday that while its sales in the South, particularly in London, were showing signs of recovery, the North was taking longer.

Alistair Leitch, its finance director, said: “The southern markets have held up a lot better. Unemployment and the amount of flats built in northern cities are holding back the North.â€

The housebuilder, which has debts of £111 million — smaller than most of its peers — is starting to buy land again.

John Watson, the chief executive, said that there were no “green shoots†yet, although the company was on target to sell 4,200 homes this year. He added: “Everyone who makes an offer now is looking for incentives, from carpets and curtains to stamp duty.â€

Related Links

* Bellway cuts dividend 83% on house demand fall

* Redrow house sales halve as downturn deepens

The biggest housebuilders are applying for £320 million of government funding to resume work on stalled housing developments. Barratt, Persimmon and Taylor Wimpey will have completed their bids for a share of the cash before Monday's deadline.

The Government set aside the funding in the Budget to breathe life back into the ailing construction industry and boost the building of new homes by an estimated 10,000 over the next two years. Property developers have struggled to finance new schemes as money from lenders and new home sales have dried up over recent months, forcing them to abandon partially finished construction sites.

Persimmon said that it had applied for £30 million to resume building on 20 sites. These include Spring Gardens in Shropshire, a 200-home scheme mothballed last year, and Ironstone, also in Shropshire, a joint venture with Barratt and Taylor Wimpey that will create 3,300 homes.

Barratt said that it would use funding to restart work on a 700-home development in Bognor Regis, West Sussex, and the West Hendon Regeneration scheme in North London, among other sites.

Rachael Waring, a Panmure Gordon analyst, said: “Builders need to start building again. They are selling what they have got and there is not much stock left. The problem is they are constrained by debt, so need to look at other avenues. Government money would be the clear route.â€

Other smaller developers are also understood to have staked a claim on the money. Winning bids will be announced in July.

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Relax. At this rate you will suffer an heart attack.

Activities picking up, more people back to work why is this not good news?

Oh I know why. You would prefer everything crash and burn to fit your sad existence?

You need seroius conselling.

you twit, back to work? you're either a very good wind up or deluded.

how about this week alone 550 redundancies announced at lloyds, 300 at a premium yacht builder in plymouth and the pending collapse of LDV on Monday...oh and and how about this nugget...

http://news.bbc.co.uk/1/hi/business/8084740.stm

You are Valerius, a king of all twit's.

misterc.

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