Housebuilders to reveal if market is still surging
Housebuilders Persimmon and Taylor Wimpey will this week reveal whether sales on site have continued to surge and outline how they plan to navigate new lockdown measures.
New home sales collapsed during the Spring lockdown as buyers were unable to visit sites but pent-up demand has seen activity jump in recent months, pushing prices up by around 6-7 per cent compared to last year.
Persimmon and Taylor Wimpey, which are among the major players in Scotland’s new-build housing market, announce trading updates this week and Hargreaves Lansdown analyst William Ryder believes both will feel more confident about lockdown measures the second time around.
“We've been surprised by the strength of the UK's housing market this year and it's possible that this lockdown will be the straw that breaks the market's back, but we doubt it,” he said.
“The furlough scheme is still going, so while some people are struggling, enough seem to feel secure enough to buy a new house. However, sales rates collapsed during the first lockdown, and we'd expect the same this time.
“A surge of pent-up demand was unleashed when the lockdown ended, though, so the builders may be able to look forward to that. Furthermore, construction activity was halted during the last lockdown but looks set to forge ahead this time.”
Last week Persimmon started work on building 86 new homes on the former Cleland Hospital site in Lanarkshire after plans were approved.
Taylor Wimpey, along with Mactaggart & Mickel, recently secured detailed planning permission from East Lothian Council for a residential development on land at Letham Holdings in Haddington.According to figures released by Halifax last week, average house prices across the UK in October topped £250,000 for the first time ever following the strongest growth in more than four years.
The Halifax data shows that on a monthly basis, prices in October saw a 0.3 per cent rise compared to September, and, between August and October, saw a 4 per cent rise against the preceding three months.
House prices in October were 7.5 per cent higher than in the same month a year earlier, the strongest growth since June 2016.
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