Help me - I bought these a month ago - when they were being tipped all over the place. Since then the sector has gone down the swannie - should cut my losses (13%) or hold on for the long haul?

Harrycat, hi there - oh dear!
Since Aug07 sp has halved, yet yield is only shown as 3% - is this site's figure wrong ( they often are!), or is the yield still this bad?
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Anyone buying now is getting the land-bank for free as PSN will continue to build homes ( not on flood plains, pse), and will make similar profits, albeit down a tad as house-prices appear to fall each month ((But is it only a small fall)).
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I've been considering this stock, but with a further 5% fall today, why not wait and catch them below £5 & 4% yield?
Some folk are saying this downturn is "enough" - but we know from the past a real downturn, ( with power behind it, -the US housing fiasco which is yet to be fully-felt round the World) - er, takes a couple of years to work out.
If this started in the UK about August07 ( when you had posted, I guess), then we have at least another year. . . . say until Summer 2009 before we come to Market, feeling Good.
Sadly I don't think "now" is the time to be buying . . . . and your view?

A huge amount has changed since Aug last year, so I would say steer well clear for the moment. Until the down trend is broken for most of the house builders, I will only be watching rather than buying.

the question is , if money is going to be as tight as predicted who will buy these new houses?

Yes, plus the snowball effect of buyers unable to get credit & therefore the builders unable to shift the properties & therefore less cash to continue their building programme etc etc. Turnover will be down, profit margins will be down, divi will be down. The only appreciating asset will be their land bank. All imo.

Persimmon appears to have passed its low, for now - may I suggest another source of woe ( for Housing)?

Namely the Buy to Let market, which has been in negative profit for a couple of years as more and more folk bought properties "For their pension" ( Late '90's but also more recently from 2001 when stockmarket looked dangerous)- - - on the face of it you borrow cheaply, let the (new) property to cover the Mortgage and as the house appreciates over 20-years you take a fat profit and Retire. Many folk then re-mortgaged and now have a string of Rental properties - TV-shows making "renovation" look easy also added many 2up-2down Properties in areas where there is little work, now their Traditional Industries have gone overseas.

However, the reality is that there aren't enough Renters about, so Rental levels are NOT covering these Mortgages - never mind, -the House price (rise!) will see to that - Well it WON'T . . . . because amateur Landlords bought too much and now see a falling Market - so logically they will SELL - and until these "excess" properties are occupied there is no need for vast swathes of "New-Build" - - - so, it follows IMHO, there will be a period of slow-down and falling prices - both are BAD for Builders and associated industries.
This is not to say all house-prices will fall, just that those on new-build estates will drag others down since they will have to be cheap on account of being EMPTY and that is never good for a house, as it attracts damp and vandals.

( Harrycat:- Their land-bank is an asset, but it is also the reason for their Debt, and the debt has to be serviced - wheras the land can look after itself - having only "value" if you want it.)
What do you think?

If there aren't any new builds where are all the Polish plumbers and Romanian slave traders going to live?

Is this an immigration issue? - or are they renting one house and sub-dividing it to see how things go?
That might explain why they are eager to work, haing no domestic distractions ( for now).
Many in the building trade are employed in "Extensions and improvement" - ie Well-off folk with good jobs ( possibly excited by TV-shows), wna t their dream Kitchen, En-suite, extra space etc and don't wan to move ( because of schools, etc)....there have been stories of a handful of such workers banding together with a Brit, who is the money-man and who knows who to employ on planning etc. this troupe then improve an area as word gets round.
I'm not convinced that the UK can continue to allow immigration and even if we did they tend to be very few with Good Job prospects ( like Doctors) and very many who are keen enough but unlikely to afford a 3-bed semi starting at 200k.
These low-wage workers may occupy the 2u/2d renovated properties I mentioned ( esp. in our larger cities), but that will have little effect on the properties Persimmon builds - My guess is PSN will move up-market selling fewer Director-homes at higher prices with really good finishes, larger plots etc. - so leaving "housing estates" for a few years.
This will reduce Turnover and profits, since the land-bank (debt), that was an asset is not looking so clever in a falling/stagnating industry.......all IMHO.

EDIT: 24 April08 - PSN down 6% today - however, since its blip-high in late Jan 08 c.8, .....it is now c.6 - rather shows that this is an industry in decline IMHO.

335p today, down a little more as markets ann. falling house prices again.
This was nearly 8 in Jan08 - howzat!
As a long-term investment one of these Builders - and - one of these "Mortgage giving" Banks - - - - - will be a great investment over time

- Ah, but which one?

When RBS makes a fist of taking over another Bank ( at peak valuation!), you can be sure a punter like me knows nowt about finances. Er, except to keep my money IN a bank, rather than "on" it.
Today - received the Begging-Mail from HBos - will try to read what's in it for me later.....I suspect it's not good. I mean - what good was the money I HAVE invested in them ( just a handful of shares, probably from the demut days, if memory serves).

307p today...guess this month will show a further drop in housing price as mortgage lending rates are still going up.

2 perhaps?

Good old GORDON.

You are right, scot. PSN is heading towards 200p and below.

Persimmon will be announcing its half-year trading statement next week.
We all know what it will reveal now.

PSN said in early Jan08 ( I think) that they would maintain the dividend AND planned to increase it. That showed some strength, and you can see a mighty blip in the sp about that time.....If that was true then, it "should" be true now....as the Crunch was plain to see by anyone that is in the upper reaches of such a company....knowing people who know people etc.
Will be interesting to see the sp movement - before (=very bad, to date)...and after!
((sp is about 1/3 of what it was then...and I recall the yield was reasonably good then...making it 3x better now...er, provided the sp doesn't slip further, which may be quite a hope whatever one thinks of one of UK "better" builders - although to date I hold none.))

could be no housebuilders left in uk by feb next year.....tw. and bdev look doomed already......anyway house prices aint going to rise till 2015.....so wont be buying anything in houses till 2013 or 2014 at earliest......they will all stagnate after another 2 years at least of being battered

There may be consolidation in the Sector... er, with PSN somewhere near the top....but who knows, what rate these big-players are leaking cash. (News today, PSN losing 1000 jobs - well that will help.).
The sp today is 225, unbelievable even a month ago - and in Jan08 it was still a strong stock, although battered....( abt 7.00 ). That's some discount, just for waiting.

Yes I agree 2 is possible - at that point many will think "enough is enough" - this week PSN results and some other builders...
So, maybe next week will achieve some clarity.

I suspect we might see another UUUUU-turn.
1) Scrap HIPs and their like - we know if a house has poor insulation, and we don't need to have a school-leaver ticking boxes to calculate the energy loss - just look at the combined Oil/Gas/Electric bills. .
2) Scrap the step in duty at 250k - this is creating a weird no-home zone....taxes should not be steped....
3) Something else...can't remember...some Government manipulation for our own good!

If the Housing Market can see some Government action, that might encourage movement - and movement creates a better climate. It's the lack of movement that makes folk wary - prices may fall, so they wait. Low prices stop folk down-sizing and the lack of deals puts pressure on the Market.

I don't think the Sector will disapear - houses are needed and new development are always popular.....except in these uncertain days.

PSN will be showing another bout of downtrend with further bad news from the building sector...I think it is sell now at 340p.

i dont hold these........but do u ever pick any winners hyleo?

also, your recent sells at des, jhl etc have shown you cant even predict downtrends in a bad market......when bull market appears again, it will be even funnier watching your predictions

We will see with PSN.

Good news for out-of-favour building stocks
PSN has reduced its something and it's looking good, it seems.
With Buys/Sells almost evens MM's have upped the price quite a lot...so new punters must be willing to pay more -

Why?
Have the young suddenly found some dosh under their matress - OR - the Government abolished Stamp-Duty ( hopes!)...No! - So, no real Market changes, just PSN adjusting their coats, for the cloder climate.

Still, good news if you bought recently.