The stich up keepiing homes unaffordable

ILW

Generali wrote: »

But there is no legal requirement to do so.

True, but a cost associated with hanging onto what is a limited resource could get things moving.

chucky

Graham_Devon wrote: »

Heres an article today showing the issues that keep building low.

http://www.bbc.co.uk/news/uk-england-23790071

If all the evidence given still doesn't suffice, theres nothing more I can give. However, that doesn't mean it's wrong. It just means we cannot agree.

Imposing restrictions on new builds and then throwing money into making mortgages easier for new builds (i.e forcing lower supply but increased demand) is the stich up.

Please stop. It's stitch up, not stich up...

wotsthat

ILW wrote: »

True, but a cost associated with hanging onto what is a limited resource could get things moving.

If builders are hoarding simply to push up land prices then yes this might force them to be more efficient.

What you think, but don't know, is whether this is actually happening. Given the timescales involved with planning then it might be simple common sense to hold sufficient raw material to allow for the vagaries of planning plus future business planning.

I can't imagine holding excessive land is without cost or an efficient use of capital - you might just be adding more price pressure to the chain to treat a problem that isn't there.

OffGridLiving

chucky wrote: »

Please stop. It's stitch up, not stich up...

Aw, you've ruined the fun.

Graham_Devon

chucky wrote: »

Please stop. It's stitch up, not stich up...

Funny that you ignore other people spelling it the same way...

Awww, fwends

Thrugelmir

ILW wrote: »

There could be an argument that it is poor business to buy up and hoard "stock" that you cannot sell. In most cases this stock would be sold off cheap and then sold on a at a lower price.

Stock also incurs a financing charge. As majority of businessess require debt to provide working capital. Interest will normally be expensed on an annual basis not when the stock item is actually sold. So looking at a very narrow time period can distort the picture.

CLAPTON

ILW wrote: »

True, but a cost associated with hanging onto what is a limited resource could get things moving.

there already is a cost of holding land

ILW

CLAPTON wrote: »

there already is a cost of holding land

Not enough to force a holder to either develop or sell though.

OffGridLiving

Graham_Devon wrote: »

Funny that you ignore other people spelling it the same way...

Erm, you're joking, right?

Tell me you realise...

martinsurrey

vivatifosi wrote: »

A bit more on land banks:

Barratts:
54k plots as at 2012 with a development timescale of 4.3 years.
http://www.barrattdevelopments.co.uk/barratt/reports/ar2012/business-review/land-and-planning.html

Taylor Wimpey:
101k plots as at 2013 with what appears to be a slower build rate. I think it works out at about 10 years.
http://www.ft.com/cms/s/0/adf95b0c-f9db-11e2-b8ef-00144feabdc0.html#axzz2cgYwASSx

Persimmon:
70,716 owned and controlled plots as at 2013. Completions approx 10k pa based on doubling six month figure (crude measure, sorry)
http://corporate.persimmonhomes.com/investor/kfd/highlights.aspx

Berkley Homes
26,021 plots as at 2012. Not sure of completion rate (too much reading).
http://www.berkeleygroup.co.uk/media/pdf/l/6/Annual_Report_2012.pdf
Proof that they were buying land at the bottom of the market:
http://www.proactiveinvestors.co.uk/companies/news/51308/berkeley-and-bellway-reveal-the-effects-of-the-great-regional-divide-51308.html

That's the top 4, here's the rest of the big builders if anyone wants to find out more about their land banks:
http://www.theconstructionindex.co.uk/market-data/top-20-house-builders/2012

you are confusing strategic land bank with detailed planning permission.

a green fieild site may be in the stategic land bank as 2,000 homes, but it might take 15 years to get it zoned and through to planning.

FYI the short term land bank will also include large sites of 1,000+ homes, and no matter how good you are, you can't build and sell 1,000 houses in 2 years, more like 5-10, so as you start phase 1 you have 800 houses with planning that you dont start until you've finished and sold the first 200.

the land bank also includes sites with just outlying permission to build XXXX number of homes. to get from that through detailed planning permission takes years and £millions


edit to add

look at Taylor Wimpeys 2012 accounts, they had 35k plots with detailed planning, they sold 11k houses in the year, now to build the infrasturcture and houses takes around 18 months (so say 17k plots in construction) so they only really have 15-18k plots with detailed planning that they are not building right now, and that means they only have around around 12-18 months of plots un started. (so for an average plot, they will get planning and then start building 18 months later, not that bad really)