Construction project starts for the three months to January 2011 fell by 28% compared with a year ago according to the latest Glenigan Index.
“The fall in project starts is largely due to the severe December weather. However, whilst the industry has made up some of the lost ground over the last month, January starts were still much weaker than a year ago” said Glenigan economist James Abraham.
Residential projects were 39% down, with private housing down 47% and social housing by 27%. “Whilst housebuilders deferred project starts in recent months in response to poor weather and weak consumer confidence, Glenigan expect private housing developments to return to growth by the end of 2011. In contrast social housing will remain subdued due to Government cuts,” Abraham said.
Non-residential project starts were 23% down. Glenigan forecast that non-residential construction will grow over the second half of 2011 as falling vacancy rates and increasing rental values lift office and industrial construction, offsetting a weakening in government funded areas such as health and education.
Yorkshire and the Humber suffered the largest regional fall (49%) with new work starting on site almost half the value over the three months to January compared with a year previously. Scotland, Northern Ireland and the North West of England saw a fall in the value of project starts of 32%, 31% & 34% respectively. The East of England saw a 3%fall in project starts, the lowest of any region.