Land prices plummeting, as predicted

Persimmon has written down the value of its land bank by a further £600 million, on top of the £40 million write down at half year stage.

That's a handsome write down of 17% of the value of 'inventories' as at 30 June 2008, barely four months ago, i.e. their land values are falling at 4% a month, two or three times as fast as house prices generally.

Which stacks up mathematically: if half of the cost of a home at the 2007 peak related purely to the site-only land value, and the value of the bricks and mortar is stable, then you'd expect underlying land values to fall twice as fast as total property values.