Are we having a pre Brexit wobble?

The latest NHBC registration figures would suggest so.

Steve Wood, The NHBC CEO, said “The slowdown in overall registrations in August seems to be partly due to prevailing uncertainties in this pre-Brexit period. Nonetheless, it is encouraging to see growth coming through in the affordable and rental sector.”

The number of new homes to be built for those in the affordable and rental sector in the UK continues to rise significantly but these gains have failed to offset the decline in the private sector registrations.

3,875 new homes were registered in the affordable and rental sector in August, a 17% increase year-on-year (3,252 in 2018), whilst home registrations in the private sector fell 20% to 8,420 (10,460 in 2018).

With the Brexit deadline looming and the prospect of a general election before the end of the year housebuilders will have to work hard to keep their sales rates up in the face of a potential “wait and see” mindset from customers.

Bovis and Galliford Try Merger

It’s not the first time this has been attempted but an increased offer from Bovis for the Linden Homes/GT Partnerships part of the Galliford Try group seems to have got all parties excited. 

There are certainly synergies. 

Firstly, Bovis doesn’t currently have a regional office north of Stafford. The merger would give them an instant presence in the North West, Yorkshire and the North East, all key regional house building markets.

It would also take Bovis’ fledgling partnerships business straight into the premier league on the back of GT Partnerships regeneration market share.

And finally, the divestment of their housing arm would leave Galliford Try as a well-financed stand-alone contractor able to focus on its core business.

The two businesses have agreed terms and are seeking shareholder approval, likely to take around three months. Should the deal proceed the newly formed company would become the fourth largest housebuilder in the UK.