Wednesday, July 2, 2008
The decline is gainng momentum
Shrinking land values add to UK housebuilder woe
Plummeting land values are piling the pressure on some of Britain's debt-burdened housebuilders just as new sources of capital shrivel up for companies such as Taylor Wimpey Plc. "Developers are dashing for cash. Every site is for sale," said Yolande Barnes, director of research at property services group Savills, highlighting a potential vicious circle of forced selling that could yet slash the value of company land banks. Historical precedents were not encouraging, property experts say. "The thing that falls the most in a downturn is the land," said Ian Marris, a partner in residential development at rival Knight Frank. Little respite for housebuilders and developers.
Posted by plato @ 07:29 PM (631 views)
2 thoughts on “The decline is gainng momentum”
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it_is_going_with_a_bang says:
The bottom line is land value and not the badly built cr4p thats sitting on it.
Suddenly the idea of obtaining the land, sometimes demolishing perfectly good buildings, then sitting on it forever as the value of land increases earning money for doing nothing is not such a great idea.
I hope the price drops like a stone and they lose everything.
Where land goes the rest will follow.
bystander says:
Did anyone catch Location etc tonight with Krusty and Phill. They are running old searches as new, again, but this time they are dressing them up as up to date. If you missed the beginning or the end of the programme you would have missed that the searches were from winter 2007 and summer 2006, making it all look rosy, although there were offers accepted below asking. The property porn brigade are doing their absolute best to dress this CRASH as a correction where bargains are to be had. As has been said many times before on this site, there will be bargains, but not of -15% now, but rather -40/-70% in a couple of years time. and don’t get me started on M&S and their poor sales. They need to sell their goods (probably from the same supplier as Aldi, Tesco etc.) for realistic rather than ‘aspiartional’ prices. Expect much more of the same in the coming week before the MPC meet. Rant over, I am sorry that this has little to do with land prices, but it makes me soooooooooooooo mad.