UK construction set to grow by 13%
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UK’s building and construction activity looks set for huge double digit growth this year as the industry looks to bounce back from Covid.
The Construction Product Association have revised their forecasts slightly which before feared the impacts imported construction products new house building and the retail sector which commercial space being hit by the corner virus outbreak.
The report shows different sectors being affected although construction activity accelerated in the first quarter of the year depending on what sector it belongs to.
Large infrastructure projects were least affected by the initial lockdown which is moving along nicely with 29% growth with major projects such as HS2 a factor with electricity, water, roads and broadband sectors all contributing to the growth.
Much of the boost to the housing market came from the extensions to the stamp duty holiday, Help to Buy scheme and furlough which are expected to help sustain demand in private housing and private housing in 2021.
The Uk’s private housing sector is expected to continue a good recovery with the Chancellor’s Rishi Sunak’s mortgage guarantee scheme boosting the housing market in the coming year.
Coupled with expectations of rising house prices during the year, starts activity is forecast to gather pace in 2022.
Noble Francis who is economics director at CPA, said: “While outlook is largely positive, the recovery in commercial – the third-largest construction sector – is expected to be muted given a lack of major investment in new projects, particularly in Central London.
“Questions remain over future demand of commercial space, particularly in offices and retail, which may be converted into residential or warehousing and logistics, if homeworking and online spending persists in the long-term.
“More notably, however, there are significant risks to the recovery in the form of supply constraints in terms of extended lead times and sharp rises in costs for vital imported products such as paints and varnishes, timber, roofing materials, copper, steel and polymers.
“This may hinder the ability of construction activity to increase in line with our forecast.
“Furthermore, concerns remain whether the high levels of demand for housing new build and rm&i can be maintained after the government stimulus and policy measures end on 30 September, particularly the furloughing and self-employment income schemes and stamp duty holiday.”