With little prospect of a rapid reduction in interest rates to spur a recovery, many in the industry are now just looking to “survive until ’25”. Joey Gardiner looks at the prospects for residential developers doing so.
There is a phrase you hear a lot in the residential development sector right now, with firms hunkering down to face a grim winter in the industry. No one quite knows who first said “survive until ’25”, but the meaning is plain enough.
However, even that bleak, Hobbesian slogan does not quite express how much of a slog the sector is in for, given many do not expect a strong recovery until much later than that. Bob Weston, founder of £240m turnover Essex-based builder Weston Homes says his version is: “Survive until ’25, and revive in ’27 – There’s nothing round the corner.”
Far from improving in the past six months, he believes that market conditions have only got worse. “I don’t think anyone in government knows or – dare I say – cares, how vulnerable SME builders, indeed anyone ranked below the top 20 biggest, are at this point.”
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