Wednesday, October 01, 2008

Northern property

Dresdner Kleinwort's construction analysts have been touring property agents and consultants in Birmingham, Manchester, Leeds and Sheffield. The six leading property agents in Leeds have sold 6 new apartments between them in the last two months. Barratt in Yorkshire is offering discounts of up to 43% on bulk buys of at least 5 units. In all four cities, agents spoke of massive over-supply of apartments; developers selling at virtually any price to shift their stock of flats; virtually all forthcoming new developments mothballed; signs of the biggest listed housebuilders descending into severe financial difficulties; residential sales staff numbers being cut by around two-thirds and a complete freezing up of the land market. Generally lenders were insisting on deposits of at least 25% for flats, with very vigorous valuation criteria.

4 Comments:

Blogger kinglear said...

Well there's a surprise.
But lets just look at it.Discount of 43%? Well, lop off 25% for developers profit and another 10% for marketing, leaves a discount of 13% - not much against an expectation of houses dropping by up to 40%. In reality, these guys should be offereing 65% off their headline price - and there are stories already of 55% discounts overall.

5:20 pm  
Blogger Ellee Seymour said...

I wonder who will profit from all this. I'm dizzy at just looking at all those figures kinglear has written, but I'm sure he is right.

5:36 pm  
Blogger Whispering Walls said...

Hi KL & Ellee - what you say is intersting KL. I suppose the winners will be those with cash which isn't held in dodgy banks. Did you see that Luqman Arnold's stake in UBS is now frozen in Lehmans?

7:32 am  
Blogger kinglear said...

ww - i like it.

10:15 am  

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