Dye tells me: "The value of houses relative to people's incomes now is high, and I'm sure that won't be the case in the future."
But I, dear reader, believe that the push in volume growth will make up for a decline in margins. As a result house prices and profit growth will both be sustainable. That said, the chaps and chapettes in the Square Mile are wary – last week several housebuilders reported gentle falls in their share price.
One decent performer was Taylor Woodrow. It rose 1.4% to reach 298p by close of play Friday. This was a year-high and comes just a month after it posted impressive final results, along with most of its peers.
Similarly, Bovis Homes closed last week tuppence below its year-high at 598p, also an increase of 1.4%. It announced good results last month, with a 2003 pre-tax profit that had risen 17.5% on the previous year at £123m.
Was Amec right to expose itself to Iraq at this time? I’m not so sure …
Hunch of the week
Still, there is only so long I can keep barking on about how housebuilders are poorly treated by the City, so I shall now cast my beady eye over the support services sector.
It seems that my pinstriped colleagues have finally worked out what Laing is all about. Many were confused – was it still a contractor? Is it just a mishmash of contracts? Well, in my opinion, today it is really a PFI investment fund. And one that is doing jolly well – last week it was up 1.1% to 214.25p, just shy of its year best. An unusual company, and one for you boys and girls to keep an eye on.