Houses. Cars. Jobs.
The stuff of domestic dreams. Not coincidentally, it’s also the stuff that underpins classified advertising markets. Or used to.
The car industry has come over all Life On Mars and is doing a good impersonation of DCI Gene Hunt. We’re not yet talking about a three-day week. But we’re getting close.
The Telegraph reports that Ford has put Southamption-based workers on a four-day week. Toyota has suspended the night shift at its factory in Derby.
Transport editor David Millward is suggesting that car manufacturers are worried about “being left with huge stockpiles of unsold cars”. August’s figures for new car registrations were the lowest since 1966.
Housing? Last night, I watched the BBC’s 10 O’Clock News. A big graphic flashed up on screen. Remarkably, it suggested that net mortgage lending fell by 98% YOY during August.
I went off to check the figures. They’re astonishing. Here’s what Reuters has to say about them:
Mortgage lending rose by just 143 million pounds last month, a mere two percent of what was advanced in August 2007 and the weakest growth since the series began in April 1993.
If you’re not at the sharp end of this collapse, head over to FT Alphaville — and take a look at a report on the city centre new-build housing market compiled by Alastair Stewart of Dresdner Kleinwort.
Granted, this is the nastiest part of a very nasty property market. These days, grim doesn’t begin to describe what’s happening to this market, which used to be an important source of revenue for city-based regional newspapers. Some extracts:
Our visits to agents and consultants in Birmingham, Manchester, Leeds and Sheffield revealed a near-apocalyptic landscape which we believe to be far worse than even the most candid builders have revealed in presentations.
One stark view was that the six leading property agents in Leeds have sold – between them – only six new apartments in two months. We were also given documentation sent by Barratt to property professionals throughout the group’s Yorkshire East division offering up to 43% off its properties on bulk deals of at least 5 units.
In all four cities agents described: massive over-supply of apartments; developers selling at virtually any price to shift stock of flats; virtually all forthcoming new developments mothballed; according to those we talked to, signs of the biggest listed housebuilders descending into severe financial difficulties; residential sales staff numbers being cut by around two-thirds and a complete freezing up of the land market.
Jobs? Here, we’re probably on the cusp of something very nasty. The Chartered Institute of Purchasing and Supply/Markit report on manufacturing came out today. It shows that during Q2, productivity growth sank to its lowest level since 1990.
Output stalled — but companies held back from making workers redundant. The prognosis from Chris Giles, the FT’s economics editor, isn’t exactly rosy:
Many economists now think the outlook is so bad that companies, which have refrained from cutting staff as they wait to see how the economy fares, will soon start making large redundancies – pushing the economy into a deeper recession than appeared likely only a few weeks ago.
Anyone out there ready for an insy-winsy teeny-weeny uplift in ad yields?
No: thought not.
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