Bovis and Redrow epitomise housebuilders’ woes
Housebuilder, Bovis, has announced that it expects to complete 1,800 homes during 2008, compared with 2,930 last year.
The group’s stock of unsold homes stands at over 900, despite price reductions and an incentive scheme aimed at attracting buyers.
The slowdown in the private housing market is forcing the builder to focus more on the less profitable social housing sector and to add to its troubles, Bovis says it will be writing down the value of its land bank, before the end of the year.
Since August, sales have increased slightly but only because the group has been able to negotiate deals with social landlords.
However, the upturn does mean that the company expects profit for the full year to be in line with analysts’ expectations.
In related news, property developer Redrow has reported that it has sold an average 38 homes a week over the past eight weeks.
Reservations have declined by an annual 45% over the year so far and the company has described the outlook for 2009 as very weak, with mortgage availability still limited.