3 million new homes by 2020? Not likely...

The number of blows dealt to the government in recent times surely now qualifies for a GBH charge. This morning, house builder Persimmon, which is not to be ignored since it is Britain's biggest housebuilder by market value and No.3 by homes built, announced this morning that sales so far in 2008 were down 24 percent year on year. It's also not going to start building any new developments.

The word in the market is that, like RBS with its rights issue, this is going to be the first of many developers to make such an announcement. This was reflected early on today by big drops in share prices among Persimon's rivals - Barratt Developments down 11% to a six-year low, Taylor Wimpey down 8.3% and Bovis Homes down 4.7%.

The government's pledge to build 3m homes by 2020 is looking to be built more and more on sand than on rock.

Will the government heed Persimmon's call for the massively out-dated stamp duty threshold to be lifted to stimulate the market? Last year HMRC figures showed that total stamp duty revenue from residential property sales rose by 40% (£1.6bn) in 2006/07 to a record £6.4bn. Over the past five years annual residential stamp duty revenue has more than doubled with a 140% rise from £2.7bn in 2001/02 to £6.4bn in 2006/07.

So that's a no then.