Public housing construction picks up

Michael Lloyd

June 10, 2019

new homes

There was increased construction for public housing in the three months to April 2019 while there was less private commercial work, ONS construction output data has found.

Public housing output grew by 4.7%, counterbalanced by a fall in private commercial work (-2.2%), in the three months to April 2019 compared to the proceeding three months (November to January 2019).

Neil Knight, business development director at Spicerhaart Part Exchange & Assisted Move, said: “The non-seasonally adjusted three month on three-month construction output figures from the ONS today show that after slowing down at the end of 2018, construction output growth has now picked up again, with a 22.6% rise compared to a year ago and a 9.9% rise on the previous three months (November 18 to January 19).

“We all know that with Brexit uncertainty, the housing market in general slowed right down, but I did say back in February that I thought there was more work in the pipeline and that this would start to show on the figures throughout 2019, and I think this is what we are seeing here.

“And while most of the increase is as a result of public sector construction, private construction is up too which is a really positive sign.

“In terms of evidence on the ground, we are seeing a lot of demand for part-exchange at the moment and as a result, we are working with some of the biggest builders across the UK.”

Construction output increased by 0.4% in the three months, driven predominately by the all repair and maintenance series, which grew by 1.0%.

The increase in all repair and maintenance was driven by non-housing repair and maintenance, which rose by 2.3%.

Construction output decreased by 0.4% month-on-month in the three months to April. This was due to a 2.1% fall in repair and maintenance, which was offset with growth of 0.6% in new work.

New orders grew 9.6% in Q1 2019 against the previous quarter; driven by a 16.1% increase in other new work, offset slightly with a fall of 4.6% in housing new work.

Blane Perrotton, managing director of the national property consultancy and surveyors Naismiths, added: “Such washout figures were, sadly, more predictable than the mid-June deluge that greeted them.

“Despite growth in infrastructure and public new housing, declines in private commercial and public other new work meant that new work as a whole barely grew at all — just 0.1%.

“And just like the weather, pessimism in the industry is not confined to London.

“It is important that the 9.6% uptick in new orders seen in Q1 is not interpreted as indicative of a healthy UK construction sector. It is actually more likely the result of developers trying to get projects over the line before Britain was due to leave the EU on March 29.

“While repair and maintenance work continues to drive growth as a whole, it continued to slow to 0.7% in April, compared to 3% in March, as the sector edges ever-closer to flatlining.

“Until Britain’s post-Brexit future is cemented, inactivity is likely to continue dominating headlines and soundbites. Realistically, it will not be until Halloween at the very earliest that the industry stops sitting on its hands.”

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