The latest Investing Matters Podcast episode featuring Jeremy Skillington, CEO of Poolbeg Pharma has just been released. Listen here.
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Nor me, cash down to £700m and now the drag of Redrow on top. Not one for now, need to wait until the market picks up to reap benefit.
Higher for longer also not what people want for the backdrop here...
Oh Dear eh ?
Earnings tomorrow morning
Declaration date 07/02
Ex date 08/04
Pay date 16/05
Hi all anyone know when the next dividend is please.
Hunt has implied that the March budget will include tax cuts for workers and tax cuts for companies, all designed to get the economy moving, putting money into pockets and winning the Tories the election. So desperate are they that a second giveaway budget will probably appear in the autumn. I think a revival of the Government Help To Buy is on the cards, plus cuts in income tax and/or personal allowances. Such changes will for sure help retailers, the holiday industry and building related shares. I am in all three, including BDEV, in anticipation of the coming months. GLA.
Afternoon Crossley. All good thanks mate.
The numbers are plucked from the air. But/and, I was responding to the “…at an eye-watering COST of £40million…”, which is grossly inaccurate.
The remediation isn’t costing anywhere close to £40m, which is the total selling price of the land. The build costs is, at most, only 20-30% of the selling price.
The 36 homes being demolished have been completed up to roof level. The other units weren’t up to roof level. None of the units had been finished internally, although the 36 homes had solar panels, which have been removed and are being reused.
£5m is a reasonable guess. £8-10m worst case.
Interestingly, if it was significant then it would have been mentioned in the full results report. I can find no mention.
The only point I’m trying to make is that one shouldn’t take badly written news reporting as “the truth”.
Afternoon Meconopsis
Hope all is well. May I ask where you’ve pulled this data from?……
but it’s far from the build cost, which will be probably closer to £80-100k per property.
https://www.msn.com/en-gb/money/other/entire-housing-estate-worth-40million-torn-down-just-after-being-built/ar-AA1n8DUX?cvid=0bb600376de44cb3b2f4be43580ed2e3&ocid=winp2fptaskbarhover&ei=9
It’s important to unpick this…
“Bulldozers have begun the mammoth task of demolishing 88 properties on a huge new housing development on the edge of the Cambridge today after developers discovered fatal defects - just after it had been built.
…
36 homes currently at the roof stage of construction are scheduled for demolition and in addition to this, remediation will be undertaken on a further 47 plots, each at different stages of partial construction”
So, that’s 36 homes being demolished, not 88.
36 + 47 does not equal 88.
Demolishing 36 homes is far from a “mammoth” task. Unless you’re doing it by hand.
“…an eye-watering cost of £40million”
Suggests an average cost of £454k per home. That might be the selling price, but it’s far from the build cost, which will be probably closer to £80-100k per property.
In truth, if you had to underpin 47 homes then you’d be able to do that for less than £30k a property.
So, actual cost to BDEV is closer to £3.6m for the demolition and rebuild (36 x £100k) plus around £1.4m for the remediation.
This was known about in the last year, but is now commencing.
Bulldozers have begun the mammoth task of demolishing 88 properties on a huge new housing development on the edge of the Cambridge today after developers discovered fatal defects - just after it had been built.
Barratt David Wilson Homes Cambridgeshire last year revealed last year that the homes, at the Darwin Green site in Cambridge, needed to be flattened after problems were identified with their foundations - at an eye-watering cost of £40million.
It explained: "To provide clarification, 36 homes currently at the roof stage of construction are scheduled for demolition and in addition to this, remediation will be undertaken on a further 47 plots, each at different stages of partial construction.
"Barratt and David Wilson Homes remains committed to ensuring that mitigation measures are in place to ensure that there is as little impact as possible to residents and the environment."
I wanna get in, but feel the price will drop to the 400s before Spring. In a bull market this is a 800p stock.
This on Morningstar - https://stocks.apple.com/AmrZaoLM_SwivEfGTMncQWg (apologies, this is an Apple News link as I can't find it on the Morningstar site, so can't do a direct link)
"No-moat Barratt Developments' shares remain appealing, offering attractive upside of around 22% relative to our unchanged fair value estimate of GBX 700. We think recent U.K. interest-rate dynamics and the late 2023 improvement in sales activity recently disclosed by its homebuilder peers no-moat Persimmon and no-moat Taylor Wimpey bode well for Barratt Development’s earnings outlook throughout the remainder of fiscal 2024 and onward. With U.K. housing market conditions retracing their cyclical nadir in 2023, we continue to expect Barratt’s earnings to bottom cyclically in fiscal 2024. We forecast Barratt to deliver 13,215 homes and a pretax profit of GBP 325 million in fiscal 2024, with earnings to progressively improve thereafter.
Investor sentiment for Barratt and its U.K. homebuilder peers has improved dramatically in recent months, responding positively to the marked drop in U.K. interest rates in mid-December 2023. Indeed, Barratt shares currently trade some 38% above their recent low in late October 2023. Nonetheless, Barratt and its peers trade on still depressed price/book multiples—relative to their historic norms—that do not adequately factor in our upbeat long-term expectations. We expect demand for new housing in the U.K. to remain robust over the coming decade with Barratt Developments ideally positioned to benefit. Specifically, we forecast an approximate 250,000 new homes will be constructed annually over the coming decade in Great Britain to meet the incremental demand for housing as its population ages. Our housing demand forecast compares favorably with the prior housing cycle, sitting about 9% higher than the average of about 230,000 new homes that were constructed annually in the U.K. over the 2013-22 period."
Nothing much important happens until Springtime re Builders shares. Warmer weather brings house buyers out of their nests... Then it gets EXCITING again.
Just sold. Bought 2022, got the final div and the Santa rally. A guy I know in a housebuilding co told me a couple of weeks back he was having a "sabbatical". Then I read
https://www.building.co.uk/focus/uk-housebuilding-recession-how-much-worse-is-it-going-to-get/5126399.article#:~:text=The%20Construction%20Products%20Association%20has,next%20year%20at%20around%20134%2C000.
So I am out for the foreseeable.
Very light on posts this bdev board!
The money making game never ends. We have an unquenchable thirst to make more.
Some people are never happy
As long as you bought in on a low, you’re better with the share price remaining low long enough to compound at a low level. Until you want to take cash dividends as a passive income, you want the share price remaining low. Otherwise you have to reinvest dividends elsewhere, which is ok, but not ideal. After all we bought the stock as a perceived best purchase in the first place. Can’t compound as easy if it goes up.
“I’d have preferred another dividend reinvested sub 500 before it’s rise”
It’s the case that we all want the share price to go up - except for our dividend reinvestments.
I’d have preferred another dividend reinvested sub 500 before it’s rise
Won't be surprised if this passes £8 next spring. But wouldn't £10 be nicer? lol
Heading back to 700p in fairly short order
Taylor Wimpey starting to motor and I'd expect Persimmion to follow suit
The March budget should put your mid to rest. Income tax allowances increased and more "giveaways". The Tories are desperate to win the election by putting real money into pockets and kick start housing. Reform is needed.
Afternoon all.
Well done LTI, nice timing!
I’m invested here and have been for just over a year now. Not done to badly so far. Having taken a look at future EPS, I’m a little worried that the dividend looks in danger of taking a more severe cut than say, to a lesser extent, TW and what appears, RDW to have their dividend covered. I’d be interested in others views on this?
ALB