Private home construction starts jumped 14% in the three months to September, over the previous quarter, proving to be the star performer as overall new building work “continues to plummet,” data from Glenigan shows.
The overall value of underlying on-site building starts – covering commercial, housing, and civil engineering — fell 5% against the prior three months and is 21% lower than a year ago, says the data body’s latest construction index.
Although new private housing work is up over the quarter it is 9% below where it was a year ago.
The report points out that, social housing performed poorly, with starts slipping back by 19% against both the preceding quarter and the previous year.
Away from private housing, civil engineering was the only other area to grow over the quarter to September, lifting 3%, despite starts remaining 29% lower than a year ago.
Glenigan economic director Allan Wilen says: “It’s encouraging to see the decline in project starts has slowed during the period covered by this Index.
“However, increased inflationary pressures and rising interest rates have put considerable strain on the industry, suggesting we’re not out of the woods yet.
“Incoming regulation from the 2022 Building Safety Act in the autumn is also expected to have a significant effect, particularly in the residential market which will likely stall activity as developers invest in compliance over construction.
“However, the weight of new regulation on the residential market could be offset by the relaxing of others, particularly the rules around nutrient neutrality, welcomed by the sector and potentially boosting starts from the final quarter of this year.
“The industry can also take hope from signs of individual vertical recovery, for instance, civil engineering project starts which posted a period of slight growth against the preceding three months.”
