beeb
Dr. Beebenson, PhD HA, ST, Offset (hons)
I read that more as them not having anticipated the exponential rise in material costs, rather than a lack of market demand. Given the massive delays in building generally, if you signed the contract pre-pandemic and it took them months to start building and the purchase price was locked in but material costs have doubled that's gonna root a business pretty hard. Really they should purchase all the materials at time of purchase so their costs are (relatively) fixed, but until the last couple of years they wouldn't have needed to and would've been able to keep overheads/stockholding low.Australia's largest home builder Metricon almost went under last week. Currently being propped up by the CBA and some justifiably panicky shareholders.
You know the market is having some "issues" when a company responsible for over 10,000 homes in the last couple of years is in that kind of shit.
If rates continue to jump, obviously people at the bottom end of the market are going to feel the squeeze as cost of living expenses pile up and the housing market cools, but IMO overall demand will remain strong - it just means the people with money will buy more rentals and accelerate the divide between the haves and have nots.
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