Specialist
Former managing director at Taylor Wimpey
Agenda
- UK homebuilding update – build rates and supply-demand dynamics
- Building material and labour pricing impacts on build rates and margins
- Regulatory changes and industry impacts, highlighting upcoming emissions requirements
- Competitive dynamics across key players such as Taylor Wimpey (LON: TW), Vistry Group (LON: VTY) and Barratt Developments (LON: BDEV)
Questions
1.
What key trends have you noticed during a chaotic last 24 months in the UK housing sector?
2.
How might the UK homebuilding market and price inflation play out over the next 6-12 months? You mentioned demand peaked in June 2021 with price inflation at around 13%, and then tailed off slightly down to just over 10% through to October. Do you expect further cooling off, albeit at quite a high level still?
3.
Are there any regions where the house-prices-to-earnings ratio seems higher than others?
4.
You mentioned detached homes will probably continue to be popular. Do you expect any shifts in demand for location? Could London start performing again, or do you think the trend of people wanting to move away from city centres will be sustained?
5.
Could you outline growth across price points? Are any price points over- or underperforming? How might this develop over the next 12 months?
6.
The Help to Buy scheme and its revisions do help to buoy demand. Do you expect this scheme to run out in 2023 as expected? Alternatively, could the government extend or implement a similar scheme past then to keep demand stimulated?
7.
What are the key details and dates to note around upcoming building emissions regulation?
8.
What specific building practices and alternative materials will be required under new emissions regulations?
9.
Are there other regulations or alterations to current regulations we should be aware of, or that you think might be implemented in the next few years?
10.
What’s happening with supply? How might supply develop in the medium term? Could it remain quite constrained?
11.
The publicly listed builders’ land banks have many plots secured for the medium term. What is this doing to price of land? How might this impact suppliers within this segment?
12.
You outlined significant price increases on materials across the board. How might that impact margins over the next 6-12 months and beyond? Do you think there’ll be a headwind, or can homebuilders pass this price on in full given strong demand?
13.
You mentioned the importance of the strategic buying time is around when you buy the plots. You highlighted Taylor Wimpey as having bought at the right time. What other key players did you notice being very active in the market when there was that slight cool-off period?
14.
How is the current environment for UK housebuilding making players think about working capital management?
15.
What do you think are the key factors driving Persimmon’s notably higher margins?
16.
Do you think in-house manufacturing vertical integration is an advantage for Persimmon?
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