Housebuilding stocks are ‘cheap’

HOUSEBUILDING stocks in Ireland and Britain look extremely cheap at present, according to Davy Stockbrokers, who believe current ratings in the sector all but assume a crash in house prices.

Davy Stockbrokers analyst Florence O’Donoghue, in a sector review entitled “Spring Jitters” circulated to clients, concludes: “The housebuilding sector’s rating is at its lowest since 1975 to 1979. However, the [overall] market had a similar rating back then, whereas the market currently is at its highest rating over the series examined.

“Notwithstanding any fears on the housing market, it is hard not to come to the conclusion that housebuilding stocks look extremely cheap at present.”