House Price Crash 5

lypsey

Berkeley reported their profits this morning as follows


Trading Analysis

Revenue for the Group was #381.2 million (2005 - #503.1 million). This comprises #375.3 million (2005 - #495.8 million) of residential revenue, of which #3.2 million was from land sales (2005 - #0.5 million), along with #5.9 million (2005 - #7.2 million) of commercial revenue.

During the period, the Group sold 1,296 units at an average selling price of
#284,000. This compares with 1,656 units at an average selling price of #292,000in the same period last year.


I find it amazing that this is 1 of several large builders who have posted profits and results over the last few months clearly showing that there is a LARGE decline in the number of properties they have sold and that the prices again are DOWN. How is it that a PLC company has to obviously tell the truth in yet those idiots at Halifax and Nationwide continually show their index as going up. Some one is telling porkies and I know where my money is

Alan_M_2

Company accounts are made up of statements of fact not conjecture, unless of course a company decides to pull and "Enron".

Statistics are baseless unless you're are provided with information on how the statistics are compiled, in so much as taking a poll on a website such as Housepricecrash.co.uk on whether there will be a crash in the near future or not, will still provide valid statistics but the sample group isn't exactly what you'd call representative. However as a statement of statistics they are completely valid.

Even historical data can be scewed by choosing to include or exclude certain pertinent pieces of information, a company producing accounts doesn't have this luxury, it has to provide factual information that comply with a pre determined set of critera, so basically you know where you are....in theory

Hereward

The one thing that Berkley's accounts don’t show is what mix of property, and their locations, were sold in the two periods. It may be that they sold many FTB homes in the South East in 2005, but have sold executive style homes in the North East this year. This would skew the statistics for Berkley's, but not the statistics of Halifax, or Nationwide.

Woby_Tide

I can't wait for "House Price Crash 99"

a new thread for every news story, we're not worthy

Alan_M_2

Hereward wrote:

The one thing that Berkley's accounts don’t show is what mix of property, and their locations, were sold in the two periods. It may be that they sold many FTB homes in the South East in 2005, but have sold executive style homes in the North East this year. This would skew the statistics for Berkley's, but not the statistics of Halifax, or Nationwide.

That thought ran through my head too, the figures could be very region specific, still, it's a big drop in turnover from the previous year however you look at it.

lypsey

The figures show a 22% drop in sales turnover.........................

BUUUUUUTTTTTT surely the market is on fire .... isn't it??

Hereward

Alan_M wrote:

That thought ran through my head too, the figures could be very region specific, still, it's a big drop in turnover from the previous year however you look at it.

lypsey wrote:

The figures show a 22% drop in sales turnover.........................

BUUUUUUTTTTTT surely the market is on fire .... isn't it??

Berkley may not have built as many properties this year as they did in 2005: perhaps they are sitting on a land bank, as they expected they average property value to fall significantly; or it could be that the properties that they have built are not the type that purchasers’ currently want, so have had to reduce their asking prices to shift them.

There is not enough detail accompanying the quoted revenue figures to draw any realistic conclusions about the state of the property market.

sm9ai

Its an interesting story. Factor in the 5% cashback or whatever other incentives you get on new builds and the sale price will be even less.

Alan_M_2

That's a reasonable statement when looking at results from one company. Once figures are produced for say 10 big builders, then a reasonable conclusion could be drawn if they're all or the majority of them are pointing in the same direction.

The one noticeable thing in the above accounts is the 6 fold increase in disposal of land.

lypsey

heres another gem

http://www.24dash.com/news/1/14027/index.htm

Sentiment is everything and nearly 25% of people think prices will be down

Xbigman

Alan_M wrote:

That's a reasonable statement when looking at results from one company. Once figures are produced for say 10 big builders, then a reasonable conclusion could be drawn if they're all or the majority of them are pointing in the same direction.

The one noticeable thing in the above accounts is the 6 fold increase in disposal of land.

Could they be expecting a drop in property prices and land prices, thus they are running down their landbank?
Regards


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