As it’s lunchtime I thought I would check the London stock exchange and see what has been happening this morning, and to be quite honest I’m very glad I did, because what I saw was incredibly positive.
Of the top six best performing companies this morning 4 of them were property developers. Barratt developments, Persimmon, Bovis homes group and Taylor Wimpy were all listed, with Taylor Wimpy heading the table with a massive 9.15% increase.
So what does this show us?
My view is that the market is of the opinion that demand for housing is set to increase and therefore it goes without saying that the construction of new homes will also need to increase. We are currently in a position where the supply of property for sale is greater than demand, but with a general shortfall of housing in the UK and increasingly positive signs of economic recovery this situation will undoubtedly reverse quickly, and the market knows this.
Increasing market confidence in the home building sector is a strong indicator that things are starting to pick up in the property sector.
