Architects of Metroland — that suburban London demi-paradise of 1920s mock-Tudor semis — knew how to keep property moving: 1) Make your new-build houses look as old as you can; 2) Make sure the government will keep paying to stimulate demand.
Hence, all those half-timbered gable ends, and much relief when state-owned London Transport funded tube line extensions.
Now Redrow, the FTSE 250 housebuilder, has taken a leaf out of their Arts & Crafts era brochures, by: 1) building 1920s style ‘Heritage’ houses; 2) visiting older buildings in London SW1, to ensure ministers keep the Help to Buy stimulus loan scheme going.
Sensibly, though, Redrow’s half-timbered new builds are outside the M25 — it sticks to flats within it — so it requires no extension of the government’s £600,000 price limit to keep properties eligible for state help.
In fact, with Help to Buy confirmed to 2021, yesterday’s results contained guidance up to its penultimate year: when pre-tax profit of £2.2bn implies a near doubling of the dividend in three years. And if a move from net debt to net cash comes a year before that, Redrow’s foundations should be as sturdy as a Metroland villa’s. That provides reassurance if the market weakens, or more cash rewards for shareholders if it holds up.
Today’s other Lombard notes:
Aveva hopes it’s third time lucky in marriage of convenience
Not Talking the Talk
News that TalkTalk is exploring an exit from its mobile operations, but intends to remain focused on fixed-line connectivity, suggests an opportunity for a radical rebranding. How about, er . . . Talk?
matthew.vincent@ft.com