Tees builders stay hopeful
Jan 11 2008 By Jez Davison, Evening Gazette
AS THE UK’s biggest housebuilder announced a 14% fall in forward sales for 2008, Tees Valley developers and regeneration chiefs were confident that the credit crisis would not delay projects in the area.
York-based Persimmon Homes, which posted its mid-term trading report yesterday, was just the latest in a long line of developers to see share prices fall; Taylor Wimpey, Barratt Developments and Bovis Homes are all down. Yesterday Bovis said reservations for its new homes in 2008 were 19% down on 2007.
But local project managers believe that poor sales performances and plummeting share prices represent a market correction rather than a downturn, and said the demand for local homes remains strong.
According to the Royal Institute of Chartered Surveyors (RICS) North East, liquidity problems in the credit market will hit new-build hardest, although mixed trading updates in the sector over recent weeks suggest that, overall, conditions are stable.
Haslam Homes, which is working on developments at Thornaby, Stockton and Darlington, said work would continue as planned although it did not anticipate undertaking further projects in the Tees Valley.
Richard Bass, managing director of Haslam Homes North East, said: “Visitor numbers to our developments and sales suggest we are now in a more normal marketplace. We are predicting a slower but steady 2008.”
George Wimpey North Yorkshire, which is responsible for the Greenside View development in Boosbeck Village, denied that it had enhanced its Easymover scheme in direct response to market conditions.
Under the scheme, George Wimpey picks up the cost of selling a customer’s property and pays stamp duty and legal fees. It will now also stump up several thousand extra for removals.
Michael Poole, vice-chair of the North-east branch of the National Association of Estate Agents, believes that the current climate represents a “check”, not a recession.
He said: “The climate is no harsher than in previous years. The Tees Valley is still going to remain a glowing light for regeneration in the north of England.”
Chief executive of Tees Valley Regeneration, Joe Docherty, added: “Although some developers will find it difficult in 2008, the projects on which we are working will suffer minimal impact.”
More homes are due to be built over the next 12 months in Tees Valley than in 2007, including an entire eco-village for 2,000 families.
