Member Info for TimBob

Semi agree with Nige_W on this; supply is vastly under the demand levels. Yes UK has on average smaller households than some countries, mostly due to significantly less multi-generation households (which wont change quickly).
Money is Cheap, and will be as long as we are in a recession...
Home Working will affect demand, but if anything, it will increase demand for homes either people upscaling or buying their own property in a location they can actually afford.
Personally think its a good time to buy into HBs as the prices are depressed by very poor sentiment; though not a great buy if your after a divi anytime soon. Long term, i doubt TW or any housebuilder will be rated in the same way as Sage, so think the more recent historic highs of £2.37 gives us a guide of future share price...

Chester,
100% agreed, this is a good long term share, i've lost money on the value with the drop in SP since Covid, but more than happy to sit on them for the monthly divi; one thing the company is focused on delivering continually.

I tend to jump between LSE and Sharecast.com for info, between them, you tend to get the full picture as each site reports SP slightly differently and have their own pros and cons... the RNS feed on LSE seems to miss some news, where Sharecast seems to show everything.

NAV report basically says they've received 80% of Q3 rents and they are hoping it'll be upto 88%... meaning the current dividend will be 130% covered by received rents, which is a good sign long term...

Will be interesting to see if this improves in Q4 or if they will look to increase the dividend slightly; i personally think they'll keep the divi as it stands for a bit and get a bit more cash in the bank in case of lower collections if the economy takes another slow down!

Tim

500p Is not going to happen for a very long time if ever! Totally disagree with you dsc1798... i've been in and out of TW since before it was TW... Yes there was a time with TW got to £6 a share, but at that time, there was only 1/3 the shares in circulation. The big rights issue in 2009 means you need to adjust any historic price info to take that into account.
Additionally, looking at Nett Asset Values and Profits, i think £300 a share is toppy, even in the next 5-10yrs, though i could be wrong.
Cancelation of the divi this year is generating additional cash reserves and enabling purchase of land at below long term market values. This will drive betterment for the company in the medium to long term and i see these being back to the 140p mark by the end of the year pushing 150-175p next year when the divi returns; if the special divi is anywhere near what it was last year, then it could push 200p, but i doubt we'll see that for a few more years now...

Simple answer, no worse than what we already know... like others have said, the issue isn't want has happened with Covid shut down, we pretty much know how that has impacted TW and the other Builders.
I personally think the results will be positive for TW... however again as other have said, the biggest issue is mortgage availability.
But whilst prices are low, i will be topping up on TW as much as i can...

Hay Chestermike, you looking forward to receiving your 1st lot of dividends>? Unless needed, at the current SP i would seriously look at reinvesting...
If you haven't seen there latest statements on rental income, it looks reasonable although there was a down valuation on the NAV following the latest fair price market valuation of the property portfolio.

Lets not forget the lessons learnt from the last recession... well the ones TW learned at least... Buying and holding land long term provides the biggest growth in value for the business. The recent share placement has given them funds to purchase more land at a low cost (not just physical land price, but also finance costs), and whilst might not help in the short term, will help drive long term value.
Share dip seen on thursday/friday is hopefully just a temporary blip on the expectation of a poor update next week!?

Morg. availability is the limiting factor here guys. Most products for first time buyers have been pulled for anything over 90% LTV; and even those at 90% have had rates pushed up! Most lenders seem to think there will be a 5-10% price correction in the next 6-12mths. Which will probably become a self fulfilling prophecy.
TW has a great long term land bank and there was no real need to raise additional funds for land purchases as they have a reasonable credit facility; though i'm guessing that raising of funds was a cheaper option!
TW, BDEV and PERSI all have social units on there sites through s106 obligations; TW have been pushing back these units over the past couple of years, so have a reasonable number contracted already that if needed, they'll pull forward for earlier completion... am sure BDev and Persi have done the same...

LOL... there's quiet and then there's a ghost town!
Monthly Divi was my primary reason for purchase; currently re-investing my monthly divi into EPIC at the current price, it's a bargin!

Hi Chestermikeb...
Have to say this board doesn't have much traffic!!! Think you've made a stirling buy with EPIC. I first started picking these up at a little over £1.00 with a 5% divi return.
Lots of reports out there say retail property is dead! But i think they mix all retail (high street and retail warehousing), which is a big mistake in my opinion.
EPIC are lucky with a lot of there sites, as they are let to businesses classed as essential businesses so have managed to receive 75% of there rents through the lock down; hopefully this continues and as they get more rents coming in as the rest of the retailers open up, the divi should hopefully creep back up to the 0.0044p/mth mark again.

hi ilikehb
Best bit of advice i was given on investing a long time ago now, was to pick two or three shares, ideally in sectors and or business you know something about... research them, and never listen to a mate who tells you about a sure thing!
If your not confident in doing the research on several companies, then i'd say research investment trusts that have a pedigree of paying out income and also those with a history of growth; you don't tend to get ones that do both... There are some good resources out there for researching both...

Oogle... One of the business im a Director at is a Independent Mortgage Brokerage... whilst there is demand in the market for new mortgages, it is fair to say the banks and other lenders have put on there cautious hats at the min. First nothing over 80% LTV was on the market as they couldn't get valuations carried out... now it appears that whilst valuations are getting back on track, they do not have appetite on LTV above 85%... there are some 90% products available, but the funds available at this level of lending is limit and difficult to secure.
My other business works with some of the big house builders and whilst we stopped everything for 2-3mths, since re-opening of sites, sales are apparently pretty robust!
Im guessing HSBC are a little less cautious than some of the other banks and also realise that like most recent recessions, house prices bounce back pretty quickly; therefore a safe bet medium to long term...?

Not at the min... I suspect the special divi wont got paid out at all but TW may look restoring the Oct one if market conditions / demand stays...

Nige, 100% agree, there will be a recession and it could be a bad one. I understand the Boris was actually opposed to "austerity" during the last recession, and some economists believe that spending should have been increased to get out of the recession sooner; we'll see if Boris follows this policy, or if he can even afford to so with the amount already borrowed this year to deal with covid19.
What i do know, TW's land purchase hurdles were based on site being able to take a 20% drop in revenue and upto 30% drop in sales rates and still recover the land cost and cover overheads. A far better position than the previous recession when sites were all running at a loss and potentially still able to pay a dividend and retain a FTSE100 ranking!?
Personally, i believe that the market has already priced in BREXIT and a potential recession on TW and the other builders. I think at under £1.60 its a good long term buy, but i do think we'll likely be up and down between the £1.40 mark and possibly the £1.60-£1.70 mark for the next 6-12 mths...

RICS housing price monitor is an interesting one... but the reality is that very few completions were made in the May period on any property due to the inability for people to move home, or at least the un-willingness of people to move. I would therefore suggest that Mays data is skewed as only those desperate to move / sell completed on sales and potentially took hits on price to do so. That being said, the vast majority of 95% mortgages have been pulled from the market and only a couple of lenders with 90% products available. This is a sure sign that the banks feel there will be a house price correction of upto 10%. HOWEVER, banks tend to be less risky since the 2007 lending hype, and as we are all aware there is a housing stock shortage, so i dont think that a 10% drop will actually materialise... tho i do think we have to realistically expect a drop... more than likely 5% in the short term?

So after selling out most my stake on the way down, and kicking myself at not buying back in at £1.40, i've managed to get back in at £1.50147 this morning... hoping the last couple of days is the result of some quick profit taking from those that entered sub-£1.40 mark and that these will back back to £1.60+ in the near future...

TW have been up and down between 180 and 210 all of 2017-2020... with a couple of blips around the brexit vote and the last election. They are in great shape, a cash generating machine and will be a good investment for the future im sure. I sold out half my holdings when they were on the way down (at the 160) mark another 1/4 when they canceled the divi. Wish i had bought back in at the £1.40 mark rather than buying EPIC shares for their dividend now! Hindsight is a wonderful thing...
Still holding some cash so if they drop below the £1.60 mark i'll be buying some more... Long term, they will be back to the £1.80-£2.00 mark without a doubt

Dobbers, its a totally differant company from either Taylor Woodrow or George Wimpey were... I definately noticed in the last two years that i was there that Refern and the main board were getting more and more cautious. Sat with Pete Redfern at Rugby match in that timeframe and he talked about managing RISK and the Cyclical nature of house building. Looking back now it is obvious that they had begun prepping the business for an oncomming recession either from BREXIT or somewhere else!

I doubt that a divi will be here this financial year now. Having worked at TW from '99 through to '19 and met Pete Redfern a number of times over the years, he is more cautious than he comes across and also has a good understanding of public image and acceptability.
Additional, TW shut sites for two months... that doesnt transfer to two months of completions lost, it translate more likely to 3mths; as it takes time to get started again from a standstill; additionally with the extra H&S steps in place, build rates will be slower, how much slower is an unknow at the min. though it may translate to better build quality and therefore a saving on customer care costs in the long run.
On that basis, whilst TW is a cash rich business, i think they'll be more likely to hold back on a dividend this year and use that as a positive PR exercise whilst maintaining a stronger than historical average cash bank.

TW and most the big house builders dont typically do anything directly with / for the Govt. Housing schemes are normally paid for by Housing Associations. Typically, but not always, the HA will pay say TW a "golden brick" payment for the land and infrastructure; as Nige_W said, it still is typically 25% of the contract value; then staged payments per plot on a monthly basis.
You have to remember, House Building is differant than Construction... as much as people in the box bashing world might like to think otherwise... and as much as other industries look at it. House Builders tend to be speculative developers so take the risk and profit... In Construction, margins are lower, but so are the risks...

Is it me or does this stock seem to be taking more of a knock than most? Down 37% on its pre covid-19 low... still paying dividends at £0.0033 giving it roughly 8% yield at 50p/share. Latest dividend declaration is 75% or renters are still paying, which is enough to cover the current dividend payments. Ok NAV is up in the air, but even if you said there was a 20% drop in NAV, that would put the NAV at around £0.80/share... Surely this should be at the 60p/share mark?