Bovis Homes issues profit warning – 20 Feb 2017

Article is here

Bovis Homes to build fewer homes. This amid reports that house price growth is slowest in 4 years.

Takeaway: The price of new homes is dropping. This is not due to lack of demand, it is due to low selling prices.

Everyone knows there is a housing shortage in the UK and a backlog of potential buyers. The reason they are not building more homes is because they can’t sell them high enough to make the profits they need. So basically it is like a situation where the buyers are at the door of the factory wanting to buy the product the factory makes but they are not prepared to pay a price that makes enough profit for the factory so the factory does not make the product.

 

 

 

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