So we are in a recession then
Discussion
sleep envy said:
frosted said:
Is that because a new 1bedroom apartment in Wandsworth starts at 350k ffs ?
That's more to do with punters paying the asking rather than the developers.It's a vicious circle for the contractors at the moment. Developers are slowly putting schemes out to the market but contractors have to be particularly choosy what they bid for as their tendering depts have been severely pared back, they can't deal with the volume of tenders that they could 2/3 years ago (plus they don't have the spare cash to throw lots of resource at work they only have an outside chance of winning).
Which means they reduce their opportunity to win, which means their turnover reduces, etc, etc.
We're also seeing contractors make bids with a ridiculously low level of profit in it for them - which does concern us as we can't gauge if they'll stay solvent for the duration of the build.
Pretty much everyone in my office has at least one scheme with a liquidised contractor or is having budget issues as the contractor is making a loss.
If you're sat on a pile of cash and/or land...
The other problem Contractors (at every scale) are facing is that the pipeline on 'new' work from front-end design onward stopped over three years ago; the projects that were just feeding-through then are now built; and yet the cost of borrowing is steadily increasing - and loans for cashflow are the very lifeblood of building at every scale, to fund the developer until sale/opening, and to enable the contractor's internal cashflow. With major developers being risk-averse, all others at the mercy of massively-restricted lending criteria (including the Bank's demands for insane short-term rates) and no market when anyone is done - oh, and NO public infrastructure investment - the ship is dead in the water.
Which is a crying shame; £1 spent on construction activity in the UK has been shown to deliver £3 of wider economic activity within the UK.
If a Government really wanted to 'prime the pump' for growth at all then judicious investment in replacing and developing our archaic infrastructure would be an excellent way to do it.
Now we're out of recession - for how long remains to be seen - the Conservative Free Enterprise Group's Kwarteng and Patel are proposing that everybody earning £50k or less should be out of the 40% tax bracket to help the squeezed middle. The 40% threshold is due to be lowered next year from just under £42,500 to £41,450 dragging ever greater numbers of experienced teachers and police officers into paying more tax.
Kwasi Kwarteng said:
This is not only fairer, it will help encourage hard work and enterprise.
Fairer, nice one and quite right too.Huff said:
sleep envy said:
frosted said:
Is that because a new 1bedroom apartment in Wandsworth starts at 350k ffs ?
That's more to do with punters paying the asking rather than the developers.It's a vicious circle for the contractors at the moment. Developers are slowly putting schemes out to the market but contractors have to be particularly choosy what they bid for as their tendering depts have been severely pared back, they can't deal with the volume of tenders that they could 2/3 years ago (plus they don't have the spare cash to throw lots of resource at work they only have an outside chance of winning).
Which means they reduce their opportunity to win, which means their turnover reduces, etc, etc.
We're also seeing contractors make bids with a ridiculously low level of profit in it for them - which does concern us as we can't gauge if they'll stay solvent for the duration of the build.
Pretty much everyone in my office has at least one scheme with a liquidised contractor or is having budget issues as the contractor is making a loss.
If you're sat on a pile of cash and/or land...
The other problem Contractors (at every scale) are facing is that the pipeline on 'new' work from front-end design onward stopped over three years ago; the projects that were just feeding-through then are now built; and yet the cost of borrowing is steadily increasing - and loans for cashflow are the very lifeblood of building at every scale, to fund the developer until sale/opening, and to enable the contractor's internal cashflow. With major developers being risk-averse, all others at the mercy of massively-restricted lending criteria (including the Bank's demands for insane short-term rates) and no market when anyone is done - oh, and NO public infrastructure investment - the ship is dead in the water.
Which is a crying shame; £1 spent on construction activity in the UK has been shown to deliver £3 of wider economic activity within the UK.
If a Government really wanted to 'prime the pump' for growth at all then judicious investment in replacing and developing our archaic infrastructure would be an excellent way to do it.
CommanderJameson said:
I think it's high time to get some serious road infrastructure built, starting with the A1 having at least three uninterrupted lanes from South Mimms to Edinburgh.
Not that I've got a vested interest in the existence of such a road, mind you. Absolutely not. No sir.
Not forgetting the A14 and the great western line.Not that I've got a vested interest in the existence of such a road, mind you. Absolutely not. No sir.
crankedup said:
Huff said:
sleep envy said:
frosted said:
Is that because a new 1bedroom apartment in Wandsworth starts at 350k ffs ?
That's more to do with punters paying the asking rather than the developers.It's a vicious circle for the contractors at the moment. Developers are slowly putting schemes out to the market but contractors have to be particularly choosy what they bid for as their tendering depts have been severely pared back, they can't deal with the volume of tenders that they could 2/3 years ago (plus they don't have the spare cash to throw lots of resource at work they only have an outside chance of winning).
Which means they reduce their opportunity to win, which means their turnover reduces, etc, etc.
We're also seeing contractors make bids with a ridiculously low level of profit in it for them - which does concern us as we can't gauge if they'll stay solvent for the duration of the build.
Pretty much everyone in my office has at least one scheme with a liquidised contractor or is having budget issues as the contractor is making a loss.
If you're sat on a pile of cash and/or land...
The other problem Contractors (at every scale) are facing is that the pipeline on 'new' work from front-end design onward stopped over three years ago; the projects that were just feeding-through then are now built; and yet the cost of borrowing is steadily increasing - and loans for cashflow are the very lifeblood of building at every scale, to fund the developer until sale/opening, and to enable the contractor's internal cashflow. With major developers being risk-averse, all others at the mercy of massively-restricted lending criteria (including the Bank's demands for insane short-term rates) and no market when anyone is done - oh, and NO public infrastructure investment - the ship is dead in the water.
Which is a crying shame; £1 spent on construction activity in the UK has been shown to deliver £3 of wider economic activity within the UK.
If a Government really wanted to 'prime the pump' for growth at all then judicious investment in replacing and developing our archaic infrastructure would be an excellent way to do it.
Significant investment in infrastructure is exactly what is needed and was validated by the IMF as a sensible thing to do, even though it would increase public debt still faster.
The main trouble is that we don't have a system which allows for decisions to be made without being challenged by every halfwit whiner. My view is that we should take the Victorian approach and put major infrastructure project through parliament, get them approved there to the extent that they cannot be challenged, and chuffing well get on with it.
Boris' island is a classic example. I couldn't give a toss whether or not it is the cheapest option. Other than a few birds having to move nests once they start, they could get on with it as soon as permission is granted.
loafer123 said:
crankedup said:
Huff said:
sleep envy said:
frosted said:
Is that because a new 1bedroom apartment in Wandsworth starts at 350k ffs ?
That's more to do with punters paying the asking rather than the developers.It's a vicious circle for the contractors at the moment. Developers are slowly putting schemes out to the market but contractors have to be particularly choosy what they bid for as their tendering depts have been severely pared back, they can't deal with the volume of tenders that they could 2/3 years ago (plus they don't have the spare cash to throw lots of resource at work they only have an outside chance of winning).
Which means they reduce their opportunity to win, which means their turnover reduces, etc, etc.
We're also seeing contractors make bids with a ridiculously low level of profit in it for them - which does concern us as we can't gauge if they'll stay solvent for the duration of the build.
Pretty much everyone in my office has at least one scheme with a liquidised contractor or is having budget issues as the contractor is making a loss.
If you're sat on a pile of cash and/or land...
The other problem Contractors (at every scale) are facing is that the pipeline on 'new' work from front-end design onward stopped over three years ago; the projects that were just feeding-through then are now built; and yet the cost of borrowing is steadily increasing - and loans for cashflow are the very lifeblood of building at every scale, to fund the developer until sale/opening, and to enable the contractor's internal cashflow. With major developers being risk-averse, all others at the mercy of massively-restricted lending criteria (including the Bank's demands for insane short-term rates) and no market when anyone is done - oh, and NO public infrastructure investment - the ship is dead in the water.
Which is a crying shame; £1 spent on construction activity in the UK has been shown to deliver £3 of wider economic activity within the UK.
If a Government really wanted to 'prime the pump' for growth at all then judicious investment in replacing and developing our archaic infrastructure would be an excellent way to do it.
Significant investment in infrastructure is exactly what is needed and was validated by the IMF as a sensible thing to do, even though it would increase public debt still faster.
The main trouble is that we don't have a system which allows for decisions to be made without being challenged by every halfwit whiner. My view is that we should take the Victorian approach and put major infrastructure project through parliament, get them approved there to the extent that they cannot be challenged, and chuffing well get on with it.
Boris' island is a classic example. I couldn't give a toss whether or not it is the cheapest option. Other than a few birds having to move nests once they start, they could get on with it as soon as permission is granted.
t. Wait long enough and even PH come around to common sense.ps : I invariably disagree with your gobsh*te, but it would be a bland and boring world if we all agreed with each other
crankedup said:
ps : I invariably disagree with your gobsh*te, but it would be a bland and boring world if we all agreed with each other
It would, indeed! crankedup said:
Wait long enough and even PH come around to common sense.
Wait long enough and my clothing choices might come back into fashion, but that doesn't make them any better... 
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