Property ‘gurus’ warn against optimism over recovery

Speaking at the Movers and Shakers property networking breakfast last week, housebuilding bosses said the industry should not expect to see a marked rise in work or profits for a year and that pre-recessionary levels would not be regained for at least three years.

Tony Pidgley, chairman of Berkeley Homes, said most firms would “continue to bounce along the bottom” for some time. He also underlined the danger of operating with high gearing. “I would never have left Berkeley Homes in the hands of a banker. They will be your partner in good times and your worst nightmare in bad times,” he said. “Having said that, good companies with a good balance sheet will get money and banking will come back. But you have got to look at the risk.”

Kevin Cammack, an analyst at Cenkos Securities, said: “It was a cheeky reminder, perhaps, that Berkeley will remain one of the very few profitable businesses in the next two to three years. The guru [Pidgley] is never one to miss the opportunity to put the veiled boot in.”

The panel was chaired by new Cabe chair Paul Finch and included Stephen Stone, Crest Nicholson’s chief executive, Kate Davies, chief executive of Notting Hill Housing, and David Brophy, chief executive of Ballymore Group.