The content of the review has been expanded, with the league table of the top housebuilders of 2002, by output, now covering 100 of the UK's leading names. Alongside the table is Wellings' incisive commentary on the industry and its key players.
The class of 2003
The top 10 companies now have a commanding, near-50% share of the new homes market, Wellings calculates, adding the caveat that the exact numbers are difficult to calculate. This could be as good as it gets for the top 10, as their dominance of the market is unlikely to last, predicts Wellings: "It may well be that the top 10 market share in 2002 has reached a peak never to be matched again."
For 2003, Wellings predicts that the top 10 could increase their output by about 2000 units, but with industry output as a whole already up by 6000 units in the first half of 2002/03, the top 10's market share could already be slightly on the decline.
The housebuilding elite's market share has been boosted predominantly through a spate of acquisitions and mergers, a trend that continued with Taylor Woodrow's bid for Wilson Connolly at the start of this month. Further acquisitions are likely as housebuilders look to boost their land supplies, but with Wilson Connolly being snapped up, there are few targets within the quoted sector for predators.
The companies in the second 10 produced 19,000 units last year, 13% of the market, but their volumes have changed little over the past few years. Growth in housing output is coming from those lower down the table, with Wellings highlighting Linden, Country & Metropolitan and McInerney among the names to watch.
The capability of new firms to grow is illustrated by Gladedale, which, following its acquisition of Bett Homes in May, will have an output of 1500 units, massively up on the 58 units it built in 1999.
But Wellings cautions that a continuing downturn of the market in 2004 could see housebuilders either cutting prices or reducing the number of homes that they build from the current low total of 170,000. The possibility of the latter could give food for thought to Kate Barker, who is reviewing the housebuilding industry's low supply for the Treasury.