Housebuilding boosted despite construction decline

Figures from the ONS show that, despite construction output declining by 0.2% in November 2016, private housebuilding rose 0.5% during the same period.

The overall construction decline follows a 0.6% fall in October and one of 0.8%  in the third quarter of 2016. Private housebuilding, on the other hand was, as well as 0.5% ahead in November, at its highest point since 201o and 12.5% ahead compared with a year earlier.

Rebecca Larkin, Senior Economist at the Construction Products Association, said:  “Overall weakness in official construction output data looks to have persisted in the final three months of 2016, which stands in contrast to other industry surveys. Housebuilding activity has no doubt been sustained by government support measures such as Help to Buy, strong growth in house prices and the availability of low-interest mortgages.

“Economic and political uncertainty is expected to intensify this year and combined with rising inflation denting confidence, means we are unlikely to see similar growth rates in private housing in 2017. Public housing, on the other hand, increased 5.6% in November and whilst monthly data can be volatile, this could signal a pickup in public sector house building after activity has been disrupted by two years of changes to funding programmes.”