Fears grow as autumn house sales flatline

Fears of a second crisis for housebuilders were growing this week after sales data showed that the hoped-for autumn recovery had failed to materialise.

Building understands that confidential weekly sales figures collected by the Home Builders Federation (HBF) from its members show that transactions in September are only marginally above where they were in the same month in 2008, when the credit crunch was at its worst.

The news comes as the NHBC recorded its lowest level of daily sales since records began in 1998.

Industry figures said the low level of sales reflected nervousness on the part of buyers and their banks over the economic outlook.

One director at a large housebuilder said: “Sales just haven’t come back at all - there’s been nothing. I’ve talked to all our competitors - Bellway, Taylor Wimpey - they’re all saying the same thing.

All the information shows the situation is really bad and it’s getting worse

Roger Humber, HBA

“A housebuilder confirmed the HBF figures show that the rate of sales in September has fluctuated between 0.35 and 0.38 per active site per week, compared with 0.7 in the boom. This is the same level as recorded since July, and only slightly above the sales per site recorded in September 2008. It is down sharply on the figures recorded in September last year.

Roger Humber, strategic policy director of the House Builders Association, said: “All the information shows the situation is really bad and it’s getting worse. It’s quite clear the seasonal upturn has simply not happened.

“Sales figures for listed housebuilders have weakened since the start of the year, but so far most have blamed this on the usual summer slowdown in sales.

August data from the NHBC showed that home starts fell from 10,638 in July to 9,954; daily sales fell to 242, the lowest figure since the start of the credit crunch. Housing data firm Hometrack said prices fell 0.4% in the month.

An analysis carried out by the Financial Services Authority showed that house prices could fall “significantly” if proposed changes to mortgage regulations were carried out.

However, the HBF weekly data is the only information on the autumn selling season.

The HBF declined to comment on the figures, but said: “Mortgage availability is still an issue and there’s concern about spending cuts. There’s no question about the long-term demand for homes, however.”