Housebuilding disappoints
7 May 2024
Construction data from the latest S&P Global UK Construction PMI purchasing managers’ index shows a mixed picture of activity during April, with housebuilding disappointing.
Overall business activity growth gained momentum, largely due to solid rates of expansion in the commercial and civil engineering markets. Near-term prospects remained relatively positive, as new work increased for the third month running amid reports of a boost to sales from improving domestic economic conditions.
At 53.0 in April, up from 50.2 in March, the headline index registered in positive territory for the second month running and signalled the strongest pace of expansion since February 2023.
Commercial building (index at 53.9) increased for the first time since August 2023 and was the fastest-growing area of construction activity in April. Survey respondents commented on rising workloads and a turnaround in customer demand, in part driven by refurbishment projects.
Civil engineering activity (index at 53.6) also expanded again in April and at the strongest pace for nine months.
At 47.6, the house building activity index data pointed to a moderate fall in residential building work, although the rate of decline was the steepest since January. Construction companies again noted sluggish market conditions and the impact of elevated borrowing costs.
Optimism regarding the outlook for the year ahead edged up in April. Nearly half of the survey panel anticipate a rise in output during the next 12 months, while only 11% forecast a decline. Respondents cited hopes of interest rate cuts in the latter half of 2024.
● Many suppliers and hire companies talking to the blog over the last month have also commented on the impact of the unseasonable wet, cold weather in April that put a dampener on building activity. Others wished for an earlier rather than later general election so that, whatever its complexion, a new government would be able to make commitments to housebuilding and infrastructure investment.
Photo: Thirdman/Pexels
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