Last Housebuilder Relegated From The FTSE100
In a sign of the times there are no housebuilders left in the Blue Chip share club, the FTSE100, which contains the elite of the UK business world. The relegation of Persimmon to the FTSE250 was the last of the housebuilders to leave the FTSE100 with Barratt Developments and Taylor Wimpey recently biting the dust.
While the move was fully expected there are short term repercussions for the share price of Persimmon with an array of index tracker funds now obliged to sell their Persimmon holdings in what is a very depressed house building sector. This may well further exaggerate the recent selling pressure and see the shares struggle to make much headway. So what next for the house building sector?
The signs are not good at the moment with Barratt Developments forced to issue an assurance to the market that they were not on the verge of going under and other constituents of the sector under serious pressure as well. When you consider that the value of Persimmon has fallen from £4 billion to under £1 billion in just over a year and Barratt Developments has seen its share price fall by 95% from last years high, things really do look bleak.
Share this..
Related stories
Home repossessions on the rise in the UK
While news that home repossession were up some 71% in the second quarter of 2008 have caused some unrest in the markets, this will be chicken feed compared to the number that will lose their homes before the economy recovers. Just over 11,000 homes were repossessed in total during the quarter but with the Bank of England suggesting that both negative equity and mortgage defaults are set to rise d...
Read MoreManaging your monthly budget
If you sit down and formalise your monthly budget today you will notice that it is very different from the budget you had just 12 months ago. The cost of energy has increased, the cost of food has increased and petrol has been up and down over the last 12 months. However, there are still significant numbers of people in the UK who are not aware of where their income is spent on a monthly basis. Ho...
Read MoreMixed signals in the UK property sector
While there has been significant discussion regarding the performance of the UK property sector we appear to be seeing the start of a recovery in the UK mortgage sector. New mortgage approvals rose by 4% in March which when taken with the increase in February starts to build a little momentum for the mortgage industry and the wider property sector.
While nobody is suggesting that th...
Royal Bank of Scotland shareholders given little hope in court case
Lord Grabiner QC, an expert in company law and shareholder actions, has poured cold water on the ongoing attempt by Royal Bank of Scotland shareholders to claim hundreds of millions of pounds in compensation through the US courts. Lord Grabiner QC was the man chosen by the government to represent them against Northern Rock shareholders who claimed that the Treasury acted in haste. The case was suc...
Read MoreErnst & Young optimistic regarding UK economy
The very influential Ernst & Young Item Club has today issued a very encouraging and moderately upbeat report on the UK economy and the UK housing market. Experts at Ernst & Young believe that while the UK housing market and the UK economy will soften during the remainder of 2010 and into 2011, they are only forecasting a reduction in house prices of 5% from the recent peak and at worst a soft pat...
Read More