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UK construction output forecast to grow 2.2% in 2014

August 5 2013

UK construction output forecast to grow 2.2% in 2014
The latest survey of the UK economy has painted a brightening picture of the hitherto struggling construction sector, predicting growth of 2.2 per cent in 2014 and a robust 4.5 per cent in 2015.

Collated by the Construction Products Association the rosy prognosis hinges principally upon private housing for the short term, with infrastructure adding to the mix later in the medium term courtesy of a 41 per cent increase in rail expenditure by 2016 and a whopping 89 per cent leap in energy investment by 2017.

Despite the seemingly good new however the CPA warn of continuing regional disparities, with London and the South East powering ahead whilst much of the rest of the country languishes in the doldrums.

CPA economics director Noble Francis commented: “The industry has suffered greatly over the past five years and earlier this year saw its lowest levels since 2001. Even with growth in the second half of this year, output is set to fall 1.5% for 2013. However, our forecast is for construction to recover from 2014. Growth over the next 12-18 months is predominantly due to a surge in housing sector activity, which is benefitting from the Help to Buy scheme. 

“Help to Buy has clearly stimulated demand and led to increasing supply from housebuilders. We forecast housing starts will rise 39% by 2015.”

1 Comment

kevin toner
#1 Posted by kevin toner on 6 Aug 2013 at 12:07 PM
Perhaps the ‘help to buy’ scheme will also help people buy existing flats. For example: my [blissful] one-bedroom city-centre first floor flat in Alexander Greek Thomson’s West Nile St building. It’s the best flat of its kind IMO and house prices have been picking up nationwide too, but still no takers as yet.

Its home-report and market value is currently low at 120k (5k below the Stamp Duty threshold to boot). There’s no better time to capitalise: I’ve put in an ‘Offers-over-115k’ to start the ball rolling.

My bank lender’s value was within the region of 140-150k prior to the recession, but had also dropped to nearer the HR value to reflect the current market.

My recommendation would be to buy it now before it’s eventually auctioned off and then sold for double the price later (possibly to me when better off). Or, if preferred: agree a rental rate; or buy to let (possibly to me, again when better off). A reputable agent quoted £575 p/m of late to market it as a let. Again, a steal for the quality of living! I was renting it out between 2001-‘06 at £550.

My plan is threefold of course:

A) If architect employers really are hiring on such fronts as the residential sector, or others, within a commutable distance from me, give me a shout, job, and I take the ‘for sale’ sign down!

B) ...if not within commutable distance, I vacate; put a ‘for rent’ sign up instead (or too) until let (or sold); or I have the flat auctioned off or bought over by an agent who transacts in acquiring flats at a percentage below the market value!

C) Keep the ‘for sale’ sign up until a buyer who’d like to stay here; or a landlord who’d like to compliment their wonderful portfolio of properties, finally sees the light. All of course whilst maintaining the mind to alternatively ‘let out’ based on an acceptable tenancy agreement.

Hopefully (A) will work out. My pitch being this:-

When I was made officially redundant (working and relying on the residential newbuild sector) this was the very day that this headline hit the news; and other sectors then followed:

Maybe, just maybe, hiring me on whatever sector will uncannily reverse this fate and conversely summon economic recovery.

Watch this space. I’ll possibly come back here to post such a headline as evidence!

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