Taylor Wimpey Share Discussion Threads

[essentialinvestor] 28/8/2018 14:52

WFL, it appears to be on a specific east London development.

[jugears] 28/8/2018 14:21

Doesn't seem to be effecting the shares.

[wfl1970] 28/8/2018 13:54

Article in the FT.

'Barclays refuses mortgage over Taylor Wimpey leases'

[fangorn2] 28/8/2018 12:20

"With EU access uncertain, they are moving towards Romania, Bulgaria"

Good luck to them :)

World all about outsourcing to the cheapest Labour point.

Wont end well as few will be able to afford to consume - and we live ina consumption led global economy, one lubricated by debt.

[marksp2011] 28/8/2018 12:14

Lets hope your views on a benign Brexit are right. In my day job I am busily transferring activity and jobs to the EU. This isn't stuff that UK will grow back as it is organisations that need to be keep EU accreditations or organisations that can't wait any longer for someone to make up their minds what is going to happen. It may come as a shock to some but the point of no return has been passed for many organisations as the lead times involved in building up organisations elsewhere are too long to place a binary bet on what is going to happen in the next few months.

The other interesting thing I am seeing is that as inertia is overcome some of the work is going to India, Egypt etc etc as the uncertainty has encouraged companies to review where they are.

UK was an "offshore" location for many EU orgs. UK had the benefits of minimal labour protection, a reasonably skilled workforce, low employment costs and EU access. With EU access uncertain, they are moving towards Romania, Bulgaria etc

[jugears] 27/8/2018 17:50

stewart64, Brexit will pass, the country will recover & share prices will increase House builders like tw, bdev etc will all thrive in the future ,However I think the market for high value houses lets say above 360k IMHO is now coming to a rapid end & could take a very long time to recover.

Essential -I am more than happy for you to pass my post on to BKG they will probably laugh at my posts as much as they will yours, I have a lot of respect for companies like BKG but prefer Tw only because I know them well as a company having supplied to them for many years & like there mixed spread around the country & any company that can pay of £1.5 billion of debt in the very short time they have is worth investing in.My only concern with BKG is that they are heavily exposed to London & the south where houses are expensive & tend to be purchased by foreign investment & where as I don't think Brexit will have any major effects on the uk Economy & foreign investment, there is always that niggling doubt that there could be & where will that leave companies like BKG ?

[stewart64] 27/8/2018 16:54

I'm still puzzling how 2019 fits into the Harrisonian 18 year housing cycle. 1974..bust, 1992..bust, 2010..
bust. Never departed from the cycle outside world wars. As I said earlier I'm prepared to give credence to "this time is different" because of Brexit. But "this time is different" very rarely happens.

[essentialinvestor] 27/8/2018 15:43

JUG,
BKG did not require a huge RI during the last financial crisis.
or enter the downturn with approx £1.5 Billion in debt as with TW.

BKG shrink the business at the top of every cycle going back to 1989.
They lead the sector on ROCE, ROE, on any invested capital metric.
I might print off your last post and hand it in to Berkeley HQ in Cobham,
which is just down the road from me, I'm sure Tony would appreciate your help ;.

As sentiment is currently so dire on most listed HB's
you can make a contra-sentiment case for buying, which is why I'm watching atm.

[garycook] 27/8/2018 14:19

Analysts at Berenberg sounded a positive note on several of the UK's main housebuilders, arguing that investors' concerns were overdone in several respects, including the sustainability of the dividend payouts from the sector, the impact declines in "average" house prices might have and buyer affordability.
Nevertheless, stock selection in the space "matters" they stressed, pointing out how picking shares of the top-performer each year would transform £100.0 into £63,000.0 over the course of 17 years, while doing the opposite would see the value of the initial investment dwindle to just £2.0.

"In our view, share price performance continues to diverge from fundamentals, with investors' memories of past performance shaping their future expectations," analysts Sam Cullen, Lushanthan Mahendrarajah, Anthony Plom and Omar Ismail said in a research note sent to clients.

Regarding companies' dividends, they said that at current levels, payouts could be maintained even should volumes fall 20% and house prices fall 10%.

As for the "average house price", it tended to be very influenced by movements in London prices, which acounted for 21% of the national price index, they said.

And interest rates were a "non-issue".

"Mortgage repayments are at near record lows when compared to incomes, deposits (available through Help to Buy) are the barrier to home ownership. Mortgage rates can almost double before long run levels of affordability are breached," they explained.

Taking all of the above into account, they retained buy-rated Barratt Developments (target price: 670.0p), Taylor Wimpey (target price: 210.0p), Countryside (target price: 430.0p) and Bellway (target price: 3,760.0p) as their 'top picks'.

[jugears] 26/8/2018 15:22

Without research & from my own general knowledge I assume the 12% are in the higher end Value houses/Flats of which Berkeley are a high contributor, If Tony was so clever he would be spreading his risk across the whole country & would have done this prior to the very over priced London & Southern Markets started to decline !He may be a clever man but it is a know brainer that building expensive houses brings its rewards whilst there is a market for them, but when it declines its not so good & why shouldn't the chairman's partner sell some shares it doesn't have to have a reflection on a companies performance there could be all sorts of reasons why she has sold unlike say a company that builds high end houses in a declining market where the directors sell shares.

[essentialinvestor] 26/8/2018 14:27

Housing start numbers in London fell by nearly 12% in the 3 month Q
ending June. RICS have also recently warned on cost increase pressures.

If anyone thinks they understand the UK property market better than Tony Pidgley,
they don't. A millionaire at 21, a multi millionaire by 23, when that figure
meant something. Both Crest and Berkeley began life where I live in Weybridge,
I've met Tony a couple of times.

I also note the TW Chairman's better half sold a large chunk.

[jugears] 26/8/2018 14:01

BKG tend to build very expensive house, Having seen plans for Tw London development these look to me to be at the more affordable end of the London price range & personally don't think there will be to much trouble selling these, that said if sales are not as expected you just simply slow the build rate to suit sales as with all housing developments, I don't read to much in to the news I look at true facts & being involved in construction industry for 37 years I always ask question & talk to people on site (This is one thing I have always been good at, My dad always told me if you don't ask you don't find out & for me its important trying to predict what work there may be in the future)& at the moment I have not heard anything negative from the 50 or so sites we are supplying to around the country, Sales have slowed a bit recently, But all the people I talk to suggest that this was due to bad weather in the winter & a very hot summer & all said that as long as interest rates rise slowly they did not think it would have any major impact on new house sales. It doesn't matter how you look at it Tw. are now extremely over sold, With a lot of bad news built in to the price, I have no worries that I have more money in TW Than anything else, the housing market may decline for a few years but I have know doubt that Tw will still be here at the other side & will probably be double the price Because the demand for new house won't go away people who want to buy a new house will still buy one even if they have to wait a few years & because we are not building anywhere near enough houses any decline now will lead IMHO to a massive short fall in the future.

[disneydonald] 25/8/2018 16:52

My earlier point re a certain amount of developments being shelved related to central London, which are mainly expensive apartments. BDEV will be out of that market in 12 months and BKG are more cautious. However, Wimps are still committed and pushing on with a new major development; Postmark. Given the poor sentiment around I believe this is why Wimps are being held back a little more than some of the other mass builders. Although outside of central London things are ok. Regardless of anyone’s politics, I believe the best thing for the building sector is a quick positive resolution to you know what or even another vote. Just need to be patient.

[stewart64] 25/8/2018 11:50

What's happening on the ground seems pretty irrelevant, the crowd have decided we are end cycle ( even though the cycle should be 2007-2025. And Brexit is the end of the world anyway.

Most frustratingly profit targets are generally being met and exceeded on Brexit sensitive stocks. We have price to earnings, yields and price to books at historically very low levels even as tbe yield on cash is close to zero.

[death by donut] 25/8/2018 11:23

As per usual the Tw. sites I work on ( Glos area ) always have a sold sign on as soon as the brickwork is high enough. One BDEV site is a little slow but I'd say that is to do with pricing for the area. Just my viewDbD

[marksp2011] 25/8/2018 10:33

JugI do some work with a team that does fitting out. A lot of stuff is stopped but it is mainly the premium office to £ 3M 2 BED FLAT type stuff rather than anything that effects real people. They were being sold off plan but that died. Now No one wants to build this stuff without a buyer. Most of what they were doing was sold to overseas and that has dried up.There is plenty of other work around and they are hiring guys.I have drinking buddy who develops premium in West London and he just exited his last job even after a year of sleepless nights. They were lovely flats but the buyers dried up who intended to live in them. He had offers for the whole development but looking for big reductions. In the end he had to sell to recycle his capitalMy view is that this was A localised bubble that burst and I don't see a read across

[jugears] 24/8/2018 16:32

disneyDonald, I supply joinery to the whole of the uk Construction & house builders & I haven't heard of any projects being shelved ? London & the south east are my busiest areas.

[essentialinvestor] 24/8/2018 16:05

I'm in Surrey, so my view is probably also skewed to the SE.
TW have guided 3-4% on input cost increases for the FY.

[stewart64] 24/8/2018 16:05

One thing I have noticed with this subdued Market is the difference between demand for new build and near record low volumes in the general housing Market. Presumably because new houses are rarer than hen's teeth they sell whatever the Market conditions at a premium. They are currently building terraced houses in the Meadows, Nottingham; about the worst borough in one of the poorest cities in the country..they are asking and getting 200k. These houses are basically being built in the middle of a problem council estate to gentrify it having cleared 1970s maisonettes for the purpose. Meanwhile thirty miles north in a really well regarded part of the Peak District which as a whole is very prosporous anyway, my 1969 four bed detached bungalow in quarter of an acre on a wooded hillside with no imposition of neighbours according to zoopla is just 320k. If a builder can do that in the Meadows I have no worries for the sector.

[disneydonald] 24/8/2018 15:45

For what it’s worth, I have a personal friend who is a Director of a listed builder. He confirms that they have experienced difficulty in hiring in the SE and London, although that is now easing as some projects are being shelved. He expects things to swing back into a more normal balance over the next 12 months or so. They are not experiencing problems in the midlands and north, as tradesmen there are less mercenary.

[essentialinvestor] 24/8/2018 14:25

Ok, thanks for the view.

[jugears] 24/8/2018 14:06

We supply all over the uk & that article was in January & not sure where there info came from but none of the companies we work for have been short of staff in the last 18 months ! papers print stories to sell papers.

[essentialinvestor] 24/8/2018 13:24

Where are you based Jug?.

[jugears] 24/8/2018 13:23

I have been in the building trade for 37 years & at the moment there is not a shortage of skilled labour & don't anticipate there being any for a while, I have also not seen any significant price increases this year & again do not anticipate any in the forseable future. Do Not Believe All You Read