Glenigan Index forecasts current decline in private housing starts
to be a temporary lull

According to the Glenigan Index, the recovery in private housing construction seems to have lost momentum with a 12% decline in project starts; however this is forecast to be a temporary glitch.

The provider of construction project leads and industry analysis, collate the Index on a monthly basis.

The Index records data on the value of construction projects that have started on-site during the previous three months, as well as analyzing the influences that will drive future industry workload over the next two years.

The latest Index, which recorded the value of project starts during the previous three months (May – July 2013), was 12% lower than the same period in 2012, reversing recent industry trends.

Having been affected by poor weather at the start of 2013, the flow of project starts had been recovering prior to this recent setback. In comparison to last year, the East Midlands, the North-East and Wales saw the sharpest falls; London and North-West England have remained relatively stable and the West Midlands was the only region in the UK to experience an increase in project starts.
Allen Willen

The company predicts the current lull to be a temporary setback, and appears to be reflective of house-builders focusing on building out recently opened sites as market conditions gradually improve. Allan Wilen (left), Economics Director at Glenigan commented:

“The current pause in private housing starts follows strong increases last year and renewed growth is anticipated over the next 18 months as market conditions improve further. Confidence in the wider housing market is improving, with the flow of mortgage approvals strengthening and house-builders reporting increases in net reservations and sales, in part supported by lending schemes such as Help to Buy.”

Conditions are also improving for non-residential, office, industrial, retail, civil engineering, transport and energy related projects after they too experienced a decline in projects starts. These sectors have all been forecast for growth during the second half of 2013 and in 2014.

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