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These comments are hilarious. Everyone saying the same thing they were saying at 150, “it’s cheap” “it’s just trying to find a bottom” “it’s silly season”. Will be saying the same things at 50p.

I almost invested in Nex a few weeks ago. So glad I didn’t! If you think Mobico with all its debt and no profit is worth £658m then buy some more. If not, it’s best to just cut and run.

The BOD has made a massive mistake IMO to change the ticker to something nobody’s ever heard of, and the new SP chart just looks like a falling knife have fallen nearly 10% since it started last weeek. At that rate it will be sub 50p in a few weeks.

FF, I don’t think anyone is waiting for 95% drops. Personally, I’ll start buying when the prices are about 30% lower than they are today.

Buy backs are good for propping up the SP, and a good investment for the group in good times but we aren’t in good times. There will be downward pressure on the SP for a while yet.

FF, BDEV has £1.1b of cash, but it also has £2.36b of liabilities so it has about £1.2b net debt which isn’t far off the 2008 figure you quoted.

Https://www.yopa.co.uk/homeowners-hub/a-history-of-house-price-crashes/

The reason things don’t seem too bad just yet is people are still on their cheap fixes. This doesn’t help HB’s though because people will stay in their current house on a cheap rate rather than buy a new house at 6% rates.

When those cheap fixes come to an end, repossessions will start coming through and we’ll have a repeat of the 80’s where property is too hot to handle. 2008 is spoken about as if it was a one off event. The reality is these crashes happen every 15 years. I remember the one in the early 90’s, and my parents tell me the same happened in the 70’s.

Sometimes the decline does go on forever, especially with so much debt, but about 18p I’ll say is the bottom. Covid low was 19p but fullers and Wetherspoons went substantially below covid lows.

We effectively have a liquidity crisis today. House prices have been fuelled by cheap credit and that is no longer available.

Say you had £1000 a month budget for a mortgage. Last year, you’d have got £211k at 3% over a 25 year term. With mortgages now at 6%, that same monthly payment would get you £155k. That means they can borrow about 26% less, so one would assume house prices need to come down by a similar amount, wiping out the HB’s margin. Then there’s rising building costs too. And with everything else going up, would people still have the same £1,000 budget for a mortgage?

You could argue today is worse than 2008. Interest rates should’ve been 3% minimum 10 years ago to avoid all this artificial growth before everything comes crashing back down to reality.

December 2008 it fell to £1.85 from about £15.

Today, the book value is about twice at high as 2008, and the peak is also about twice as high this time at £32, so I predict the bottom will also be twice as high at around £4, or maybe a tad under- which I predict will come this December.

What do others think?

Very much doubt there will be any further dividends at least for the next 12 months.

Peaky, at the current fall rate it will break a tenner next week.

I really don’t buy into this buy when everyone’s selling and vice versa. You just end up catching a falling knife. It will go flat for several months before it returns to growth, which will probably be the back end of next year.

Yes the divi was a mistake, and realistically they can’t pay another one for a few years.

These interest rises are fuelling inflation imo. Prices are having to go up just so firms can service their debt. Workers demanding pay rises to pay their increased mortgage payments. I wouldn’t touch this share until it’s clear the downward trend has reversed.

Sale on with a further 25% off. Stock is going seriously cheap.

PSN was massively overbought because of the divi, trading at 3x the NAV which is unheard of for a HB. Yes, it has fallen more than other HB’s and will continue to do so as it is still overpriced compared to the others. PSN fell from £15 to under £2 in the last crash so I think £7 will easily be seen this time. Based on what fundamentals should this be £15? You’re comparing this to modified cars and tins of baked beans and you reckon Im the one who doesn’t know what I’m talking about? 😂

Even if they can afford it, they will be negotiating hard, there’s no denying it’s a buyers market. PSN should currently be around £8.60 per share if it was valued in line with all other HB’s (80% of nav). Give it a couple of months when there’s no divi announced and PSN will be valued in line with the other HB’s which will have also fallen back. I dare say PSN will be around the £7 mark this year.

Your comparison with a 60p tin of baked beans doesn’t make sense- Heinz can put the price up and people can still afford to pay it. People can’t afford to pay the house prices now mortgages have gone up, so housebuilders either have to reduce prices/add incentives or they don’t sell them, so the margin is squeezed at both ends.

I never said 10% inflation takes away 10% of profit. It takes away much more than that. In simple terms let’s say you sell something for £100, it costs you £90 to make. £10 profit. Say your production costs increase 10%. It now costs £99 to produce, you make £1 profit. That 10% cost rise reduced your profit by 90%.

Do share your methodology. I’m not sure how I could work it out per plot when each plot will vary massively depending on size and locality. Looking at the margin and how cost pressure and revenue decline eats into that is the only way I can see.

Whether they’re giving incentives or reducing prices, it all comes out of the same pot. My point is that when the margin is only 14.7% and it’s been squeezed at both ends, it soon ends up in a loss.

They may not be reducing asking prices just yet but they will have to start. Just look at their website. I don’t see any reserved properties- all still available.