House builders would rather stop building, lay off workers and add to the problem than reduce the prices of the houses. They think that if they hold it will eventually get better and they can go back to charging amounts that bear no resemblance to the price of building.

David Green, Newark,

The market is flooded with appartments here in the West Mids,
No major House Developer is building a decent 2/3 bed semi design,which might attract 1st time buyers,They were blinkerd in getting the most profit from building blocks of 12/24 flats at £120,000 upwards.

fred the builder, wolverhampton,

Ruth in Oxford, you are so, so lucky. The bank has just stopped you from making the worst mistake of your life! Prices are going to fall by at least 10% per annum over the next four to five years, so bide your time, carry on saving and you should be able to get a good mortgage deal in due course.

Paul, Coventry,

Persimmon has acted pathetically.

Why should the state take the hit when the company can just as
easily reduce their asking price by the stamp duty amount?

Instead of cutting down on building and sulking like a spoilt brat, Persimmon should change strategy and start offering decent prices.

Joanna, London,

Alleluia, Will be occasion to buy house with good price, not ridicules like they are now ;D

tom, leeds, uk

why is everyone so upset that hugely over inflated house prices are falling. Would it be so bad if our children could afford a house in the future without taking on extreme levels of debt.

mel, worcester,

My advice to Persimmon is to sell its land bank so that others can get on with building affordable housing.

If Persimmon and the others don't want to sell their land banks, tax land banks heavily. In fact, the only real tax that we need in this country is a tax on land. The others can go.

Alfred, Isle of Wight, UK

Perfectly correct Alistair, but much of the bargain price land has been used and much of that which remains was bought on spec that at some time it would become developable, which doubtless it will. The fact remains that anything bought in the last eight to ten years was bought at a premium.

Richard Crow, Warsaw, Poland

When Sales drop, do a Promotion! Buy one get one Free! Or just halve the Selling Price, as previous contributers have commented their "Land Banks" were bought at "Knock Down Prices". The only people to gain from the present fiasco will be those that created it! When will the "Auction Be"?

Paul, Newtown,Powys, UK

The whole thing has been created by the banks and now it is spreading to other sectors, welcome to a needless recession!

Jonathan, London, England

I don't have much sympathy with Persimmon, but I do think it's hilarious to see people criticising a company for trying to maximise profits. If you want social responsibility as the prime motivator look to government, companies are there to make profits, reinvest, grow and pay taxes as a result

Guy, London, UK

My experience is that banks ARE refusing mortgages and checking details more than they were in the past. I am selling my house and on my second purchaser, and fear this one may be refused a mortgage too...I've not seen this issue mentioned in the papers. Is it my bad luck or is this widespread?

Ruth, Oxford,

erm how ludicrous is this statement, knowing the short sited labour goverment they will probably respond to this insane request. FIRST time buyers cant buy becasue PROPERTY is OVERVALUED these companies have made too much money from there BATTERY HEN approach to living. PRICES need to go south.

amit hindocha, leicester, uk

Builders who maintain a large land bank will normally prosper but time is their enemy.
If housing demand falters the cost of carrying the land can in short order wipe out profits.
It is not a question of being unable to see the elephant in the room.. But why scare away buyers?

Keith Morley, Toronto, Canada

In the past ten years those building societies have made BILLIONS of pounds in profits and now they need somebody to kick start the market. Has the world gone insane???? Rahter than bailing out banks and lending 50 billion pounds of tax payers money they should have done something to stop the bubble

Fred, Newcastle,

Never mind, even though the credit crunch has forced demand through the flagstones, we're still an island. This 'fundamental' alone will maintain high house prices forever.

Thank the stars we're not landlocked like Switzerland - if they run out of space they can just invade France or something.

Dave Hall, Stafford, UK

Persimmon - like the vast majority of housing 'developers' - have considerable land banks, of course, much of it bought at bargain prices years ago - certainly not at premium costs as one of your correspondents claims! There are absolutely enormous profits to be made in house building in Britain!

Alistair Pugh, bahrain,

And he's the chief exec!
No wonder the shareholders sold. Where's the plan? Other than "throw me a line"

He should move to the banking sector. Oooops too late.

Why is it only zoo keepers can see the elephant in the room?

Tom Taylor-Duxbury, Ludlow, UK

Instead of asking the government for a favour why don't these companies do the government a favour and not resort to making people unemployed as soon as profits dip. This only adds to the problem. By halting construction, they are stopping FTB's by artificially raising the prices and unemployment

ali waheed, london,

"This is not so much a pricing issue as about mortgage availability. For the first time in my experience there are not enough mortgages for the houses available," Mike Farley, chief executive of Persimmon, said.

Surly that becasue they have built too many! Not because of tougher mortgage terms.

David Bates, Portsmouth, Hampshire

ALL of this could have been avoided, if houses were affordable. The taxpayer bailout, bank shareholder dilutions, the run on Northern Rock, the rising levels of bankruptcy and reposessions, the falls in retail sales... and STILL those calling for lower prices are called 'doomsters, irresponsible...'

Dave Hall, Stafford, UK

....to say nothing of the environmental effects of long commutes by an immobile workforce, the generational wealth gap, social division, the diversion of disposable income from elsewhere..

Blame Kirsty & Phil, the banks, 'investors', government.. but NOT those just looking for a fairly priced home.

Dave Hall, Stafford, UK

So housebuilders have for a while being making bumper profits, buying land, then by the time they build the land has escalated in value taking the achievable house price with it. So what have they done with the additional profits they made? A cushion fund for a market slowdown? I doubt it.

Alan, London, UK

But but but... It's different his time.

More immigration (construction workers about to leave), more single people, more divorced people etc.. etc..

Mmmmmm yeeeee essss (to quote Mr. Paxman), where?

Austin Tassletine, South West, uk

Why don't they drop their prices? That usually has the effect of selling more, doesn't it?

Davie P, London,

There'll be no kick-starting of the mortgage market. How long will it be before it sinks in that in order to sell property, prices must be reduced to sensible levels?

Is this subtle blackmail by builders - "buy these ridiculously overpriced piles of junk, or we'll stop building..."

MD, Varna,

I can't see that an increase in the stamp duty threshold would make much difference, as most first time buyers only paying 1% - I don't think Persimmon would be complaining if they were getting 99% of their asking price (ie minus the 1% stamp duty!!!)

Gillian, London, UK

This is no surprise. The building industry threatens to stop building to put more pressure on the government to continue to defy gravity and keep the housing bubble inflated.

A land value tax would address this type of behaviour. At the moment the incentive is to hoard land and restrict supply.

A Hariis, Kettering, UK

"Persimmon also called on the Government to raise the stamp duty threshold in an attempt to kick-start the mortgage market and restore confidence to first-time buyers."

Persimmon could drop their house prices to aid first time buyers...

Neil, Tamworth,

Chris is correct. Where Persimmon abandons building, others will pick up. Houses even at 70% of current prices should still be profitable. The retoric is just a cynical attempt to strong-arm the government. However, new builds will inevitably decline, so their decision is understandable.

David Slatter, Cambridge, uk

Consumer confidence often do not reflect the reality of the economy. If the house builders have applied some common sense rather than keeping on betting housing boom to continue indefinitely, they would not be in the position they are in house. The problem is greed.

Jie Zhao, Guildford,

The only Problem with stopping building houses, is that it will affect future housing stocks, so this may mean that in a few years time there will be a shortage of first time buyer/new homes.
Any housing shortage will only cause prices to rise again!!!
And so repeats the Boom Bust cycle...

Paul, Portsmouth, UK

Just another example of how we have all been conned into indebtedness and misery for millions. The cracks in this "inspired" economy rise of the last ten years are now beginning to reveal themselves - expect great chasms over the next few years.

JPR, Ryde,

Contrary to what the CEO and shareholders would like him to say Brown should actually be encouraging the next generation of first time buyers to keep their powder dry and wait until prices return to a level commensurate with income. Falls in house prices only hurt the tiny amount exiting the market.

Nigel, Hamilton, Bermuda

A few months ago people were stressing the need to build homes to cater for the housing shortage.We were all convinced by this propoganda which in turn helps to keep the increase in prices on the agenda. Who are these people? If they had any sense FTB,s would walk away in droves.

Garry, Sheffield, South Yorks

Persimmon will also have paid premium prices for the land bank they have accumulated and to develop on it now at a time of falling house prices would result in a loss. As things stand the land can remain on the balance sheet at book value and I'm sure this will have featured in their decision.

Richard Crow, Warsaw, Poland

The filthy coporate scum! Our society needs protecting from organisations/people like this. The capitalist nature of modern society is choking our progression, the evidence is all around us. Things need to change before our society tears itself apart.

Mike, West Midland,

If they want buyers then they should build something a cost people can afford instead of asking for government handouts. Why don't Rolls Royce have a subsidy for first time buyers!!!These idiots shouldn't be in business if they can't prepare for the ritual cycles of their industry...pathetic

Paul, Blackpool,

Why would anyone spend £190K on a brick box (a flat) that costs no more than £50K to build?

Until that balance is restored no banker in his right mind will lend money with brick boxes as collateral.

Pedro, Stratford,

If I am not wrong, I read on the last times on sunday that Persimmon was one of the company whose shares were worth buying....
is the guy who suggested this clever move still around?

riccardo, brussels,

"This is not so much a pricing issue as about mortgage availability"

This is VERY much a pricing issue. Regardless of whether a FTB can find a suitable mortgage, £200k for a flat in an iffy area is ridiculous! Get real, prices must fall or no new FTBs will be entering the market any time soon!

Dave, Chelmsford, UK

Persimmon are going to be waiting an awful long time for conditions to improve. Risky, excessive lending is now over and prices have got to drop to a level that is affordable. I can not think of any other industry that stops operating because they are not making the excessive profits they once did.

Chris, Chipping Norton,