Further woes for housebuilders July 9th, 2008

Today it was the turn of Bovis Homes and Redrow to add to the doom and gloom of the housing sector. Both companies will cut 40% of their workforce which will mean 400 job losses for Bovis, whilst Redrow will shed 550 posts.

This is the bleakest state the housing market has been in for years. Job cuts, falling sales prices, low numbers of reservations and an increasing number of cancelled purchases makes for tough trading conditions. The attention has turned from profitability to cashflow as builders look to ensure the Bank covenants are not breached.

Despite the poor outlook, the markets reacted well to the news. Bovis Homes shares rose 5.5 pence, or 1.7% to 323p, while shares in Redrow gained 3.6% to close at 100p. Redrow shares rose as much as 14% earlier in the session before dropping back to close 3.6% higher.

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One Response to “Further woes for housebuilders”

  1. bullmarkit.com Says:
    July 11th, 2008 at 1:30 am

    Further woes for housebuilders…

    More doom and gloom in the housing sector, this time from Redrow and Bovis Homes….

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