I was under the impression it was the 15th. But proof is in the pudding tomorrow |
I wouldn't be surprised to see the divi cut again.
Their TU is tomorrow.
There are several HBs reporting over next few days.
PSN 14th
VTY 15th
TW 16th
Crst 21st |
171m net cash I thought that figure was higher and 14% margin moving forward and 600 less plots sold feel like we will see a still lower share price over next few months. There is no confidence the market is horrible and as others have commented UK plc is between and rock and a hard place now with no movement. I hold and was 60% up I am now break even with some divis but I am not convinced this share price is top up time. |
Further broker Buy ratings here:
UBS raises Persimmon to 'buy' (neutral) - price target 1,540 (1,790) pence
Persimmon gets upgrade to 'buy' ahead of next week's trading update |
jd, quality post. |
Adam,
"Its hard to be positive on housebuilders I agree given the impact of Reeves budget"
The problems have been around for a lot longer than the Reeves budget.
Covid provided HBs a boost.
HBs made hundreds of millions of pounds from Help to Buy scheme. That's closed.
I've been negative on HBs since covid, initially going short then trading on the way back up and then going short again last summer. That was before the budget.
Go back to before GFC and then you'll be closer to the mark.
If Labour's Chancellor is your problem, don't forget the UK has 4+ years of current govn. Starmer has said he backs his Chancellor, so little chance of a change anytime soon.
There will, obviously come a point when majority of challenges are factored into the price.
That will be the time to buy.
Let's see what the HBs say in their TUs |
Julie,
Several HBs, inc PSN/TW/VTY/Crst, are reporting over next few days. That should give us an ideas as to how they believe current trading outlook.
Currently, it's the outlook which is important.
There's still some time before the next BoE meeting, so plenty of time to look at possible inflationary pressures. |
Adam,
To be honest I think from a valuation perspective the housebuilding sector got ahead of itself and 1700 was very much a high water mark for PSN. The issues goes beyond Reeve’s budget and the seeds were sown by Sunak and Hunt. At a macro level the chill winds are blowing and whether a blue chancellor or a red one, I sense a reckoning is coming. Hunt kicked the can down the road, Reeves is discovering that it can’t be kicked much further (and not at all if you adopt idiotic tax policies rather than take a knife to state largesse). For housebuilders in the short to medium term it is mortgage affordability and the lack of economic stability that is going to make it a lot harder to sell houses. If your time horizon is longer term, there may be a value opportunity but for now I am avoiding the space but have no issue with being proven wrong. |
jd96
Its hard to be positive on housebuilders I agree given the impact of Reeves budget, but equally 1700p to sub 1100p for PSN over c.3 months feels overly harsh. Obviously depends on your time horizon but if you're looking out more than 3-6 months, I think PSN are a solid bet.
Adam |
Tomorrow’s trading update should make for interesting reading. Both in terms of volumes, sales mix and level of buyer incentives. I am actually bearish on housebuilders at the moment despite the level of share price retrenchment over the back end of last year (and this) and have been for some time despite the clear need for new housing stock.
Shift in yield curve bodes ill, their costs are going up and the sales mix is shifting to lower margin house building activity. I actually think carrying values on landbank need to be scrutinised because if margins keep falling the embedded value in their landholdings needs to be adjusted accordingly. |
Will we see three figures this week? |
Quite agree, massively oversold but we may as well hit that target of 1000p now. I would imagine quite a few are holding out for it. |
This gov's (utterly under qualified) cabinet members should be made to take their pay in shares. Maybe they'd wake up to how the economy works. |
Next update due 15th January I believe. Should be positive. Way oversold. |
Cupra,
"People keep talking about affordability and yet here’s my business smashing records"
It's not just people though.
The HBs, themselves, are talking about affordability, having to use incentives etc.
Obviously more will sell at the mo as some will try and beat Stamp Duty changes coming into effect in 3 months time.
There's huge tax rises, huge minimum wage increases which will impact many businesses and therefore potential jobs cuts, which will impact, um, affordability.
PSN talking about affordability. This just 2 months ago!
"Affordability and value remain important to our customers. Affordability constraints, particularly for first-time buyers, have been helped by the initial reductions in interest rates and a greater availability of over 90% loan-to-value mortgage products on the market than a year ago.
Overall pricing held firm in the period, with incentives continuing to run around 4-5% on average." |
People keep talking about affordability and yet here's my business smashing records for January which is normally a very quiet period for us. I visited a site (not persimmon) yesterday and asked how the new year has been. I got told great, sales have sold 2 plots on the first day back. Don't get me wrong, I know some areas it's very different but my company is nationwide and we're as busy as we've ever been. |
cashisking
"it’s a basic need"
Being inside a place is a need. Having food/water, air, warmth and health are basic needs.
Buying a new build, at huge premium to existing property, is not. It's a luxury. |
cashisking,
"Historically, interest rates were very much higher during 70s, 80s, 90s,….and people were still buying homes"
That's a very simplistic view without actually understanding the full picture.
During that period potential homebuyers and homeowners budgeted for higher interest rates. They were the norm. An increase in interest from 10% to 15% was 50% increase.
Crucially those potential homebuyers & homeowners had mortgages approved on SINGLE income and usually around 3-4 x SINGLE income. Therefore, budgeting and leaving huge headroom. The partner could also find PART TIME work to help.
More recently, potential homebuyers and homeowners have been budgeting for low interest rates. A rise from 1% to 4% is 400% increase (as opposed to 50% for 10% to 15%). Crucially, as more and more mortgages are approved on 3-5x JOINT INCOME with both partners working FULL TIME, so they can't work extra to make up for short fall.
There's a huge debt crisis. Govn, companies/organisations, individuals. |
House prices were considerably lower compared to wages back then. Affordability now is the issue and why HB's are being hit. Less production - lower profits. |
Historically, interest rates were very much higher during 70s, 80s, 90s,….and people were still buying homes, it’s a basic need, PSN share price looks clearly oversold at the moment but that’s markets! |
 Ricardo,
All going as predicted.
sikhthetech - 13 Jan 2024 - 14:41:18 - 5191 of 5865
ymaheru,
#5183.
Your post is in line with my thinking. My point has been that it's not just about interest rates. Although, I don't agree on the point that interest rates is the biggest factor in affordability.
The biggest problem is affordability. People are struggling to buy essentials, let alone homes, let alone new houses which command a premium.
There is a huge debt crisis, a debt bubble with world governments, businesses, individuals.
After GFC, there was QE.
There was Help to Buy, low interest loans, credit and anything and everything to encourage people to take on huge debt - a debt bubble. We've already seen some banks going bust last year. That I believe will snowball and more will follow.
Just look at the % increase in incentives to encourage potential homebuyers to take on more debt.
House prices are simply too high compared to incomes. Homeowners/potential homebuyers are spending the majority of their income on housing.
That I believe is unsustainable.
Govn interference never works. It simply delays the inevitable and causes more misery to more people.
sikhthetech - 08 Jun 2023 - 13:50:47 - 13781 of 20638 Taylor Wimpey
and those same thousands upon thousands have bought at the top of the housing market. House prices falling and new builds usually command a premium (can be 20%). So those thousands upon thousands will soon be negative equity as well as paying significantly higher mortgage payments.
That's exactly what happened in GFC with some properties falling 40%!!!!
Now do you see how the company/sector newsflow has been as expected and is following a similar course.
Where's the clueless, discredited muppet Beckers today? |
I’d be getting out of anything housing related very quickly, for get stupid newspaper reports and media drivel on house prices, news for the great unwashed, the big story is bond yields blowing out, U.K. debt is costing a fortune. 2008 on steroids starting to take shape. |
Amazing how Jugears & Becky have been completely wrong on HBs and TLY. TLY up 7%.
Yesterday, the govn published NHS plans which include huge increase in use of Private Providers, as was predicted.
Significant shareholder increases today.
How can you be repeatedly clueless???
I'm short on HBs...
TW shorted at 168p, whilst you been loading up all the way down from 170p |
Just mention TLY he will soon go away LOL |
Stonks
Different providers, not reliable indicators.
It's the trend which is more important. The only data which is reliable is Sold prices, from HMRC/ONS
Estate agents publish asking prices, which often get offers and so discounted.
Mortgage providers publish mortgage approvals, which doesn't mean it property will be bought.
RICS provide data based on surveyors valuations - same as mortgage approvals.
ONS - sold prices. Actually sold so more reliable. |
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