“More Hovis than Bovis”

“Like a loaf of bread, the house bullder Bovis is a bit crumbly. Its chief executive has just departed, in advance of some poor financial results. One of the company’s problems seems to be that it can’t build the houses it promised to build.

At the end of last year Bovis issued a profits warning. It stated: “We have experienced slower-than-expected build production across the group’s sites during December, resulting in approximately 180 largely built and sold private homes that were expected to complete in 2016 being deferred into early 2017”[1].

One story not covered in the company’s media releases featured heavily in The Times this morning, and also in the Guardian [2]. This is that Bovis was paying purchasers cash of between £2000 and £3000 to complete the purchase of new homes even though the houses were not ready. Some 650 people are members of the Bovis Homes Victims Group [3] set up on Facebook to share their depressing experiences.

One lesson to be drawn from this story is that reliance on the volume housebuilders to deliver the housing we need is a fool’s errand. Despite its use of standard designs, of as low a density and as a high a price as they can get away with, Bovis hasn’t met its own targets. Moreover, all large housebuilders shy away from building on brownfield – previously developed – land because it costs more to build there than on green fields. And so we get urban sprawl and loss of productive farming land or greenspace for us to enjoy. Meanwhile the government blames local authorities and the planning system for delays, while turning a blind eye to the failings among its own corporate supporters.

At the same time, small and medium-sized housebuilders are having difficulty finding land on which to build homes, as a recent report from the Federation of Master Builders and the Local Government Information Unit showed [4]. The report did aim criticism at local authorities for concentrating on large developments when drawing up local plans, a charge that is certainly true in some areas. This bias against small firms also hinders the development of housing co-operatives which design the housing their members want rather than what the housebuilders tell them they can have.

NOTES

[1] Bovis Homes Group plc press release 28 December 2016 at http://www.bovishomesgroup.co.uk/media-centre/press-releases/press-release-173/pre-close-update/

[2] Guardian story at https://www.theguardian.com/business/2017/jan/11/bovis-accused-of-pressurising-buyers-to-move-into-unfinished-homes The Times is behind a paywall.

[3] https://www.facebook.com/groups/BovisVictimsGroup/

[4] http://www.fmb.org.uk/about-the-fmb/policy-and-public-affairs/new-fmb-research/”

Source: https://petercleasby.com/2017/01/11/more-hovis-than-bovis/