Friday, January 11, 2008
UK building sector down the drain
Bovis Homes adds more housing market gloom
Builders' profit warnings were the beginning of the very end in Spain, US and Ireland exactly 12 months ago. Which makes my HPC forecast of -5% by August 2008 and -10% by year end.
Posted by confused76 @ 11:08 AM (477 views)
3 thoughts on “UK building sector down the drain”
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drewster says:
I still believe that Ireland has it worse than us. Having adopted the Euro, they were tied to significantly lower interest rates than us. They built far more houses per year (in proportion to population) than we ever did during the boom years. They had greater immigration from eastern Europe than we did (in proportion to population), and many of those immigrants were employed in the building trade. If those Polish builders, plumbers, electricians, and carpenters return home, then Ireland could be in for a very hard landing.
Spain is in a precarious situation too, largely for the same reasons.
crash bandicoot says:
I have a new development in my locality and their asking prices are shocking (£20-30k above anything else on the market). I realise that they are probably giving massive discounts behind the scenes but they are still contributing to local inflation of housing prices. Ultimately these guys will be contributing to price falls as they don’t have the wait and see option available. If they don’t build and sell houses they don’t make any money. Since most are sitting on land banks that are 20 years old they have quite a cushion too. I bought my first house new from a builder in 1995 and it was £10k (20%) cheaper than pre-owned houses then. Expect the same again in a year or so.
confused76 says:
Drewster,
yes I know here is different, it is a new era, etc. etc.
Wrong, all differences are baked into the house price already
As per the migrants, expect a strong outflow from here, with rising unemployment and declining pound…
At least they got the Euro there in Ireland!!