"More homes on cheaper land"
That was the headline in The Times on 28th February 2012 and particularly referring to Bovis whose full year profits were up 75%.
Bovis’s strategy is selling more properties on cheaper land.
Housebuilders will find a way to make money and whilst it may have taken them a few years they have explored and succeeded in making it pay. Whether land is cheaper in headline prices paid or land is acquired ‘on the drip’ with deferred purchases, the result has been a healthy balance on the books.
Bovis’s average home costs £180,000 and sales were up 8% in 2011.
The problem is that overall not enough houses are being built but you would have to have faith that once the housebuilders are making money they will then find ways to drive volume – that’s their business after all.
Upbeat results from Barratt and Galliford last week also point the way to a healthier picture with the housebuilders.
With nothing dramatic on the horizon to change factors for supply or demand the house builders will be gradually getting back to building more houses.
At Harris Lamb, selling and buying land for housing, as well as working up planning applications, is steady for us; let’s hope that continues and the housebuilders contunie gathering some financial strength again.
Pat would be happy to speak to you about the planning potential of any land holdings you may have. He can be reached on 0121 4559455 or via email: email@example.com.
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