The value of work starting on site in the final quarter of 2018 was 2% lower than a year earlier, according to the latest Glenigan Index. On a seasonally adjusted basis, starts were unchanged on the previous three months.
Commenting on this month’s figures, Allan Wilén, Glenigan’s Economics Director, said:
“Increases in private industrial, commercial, social housing and civil engineering work helped steady construction starts during the fourth quarter, offsetting declines in private housing starts and limiting the overall year on year decline to 2%.
“Private residential starts during the three months to December were 21% down on the same period a year ago. On a seasonally adjusted basis starts were 13% down on the three months to September. Quieter conditions in the wider housing market appear to be restraining private housing project starts, with developers focussing on building out existing sites. Political and economic uncertainties are expected to continue to depress project starts in the near term, but the recent extension of Help to Buy to 2023 should help support project starts as the UK economic outlook becomes clearer. In contrast social housing starts have recovered, rising by 16% against the three months to September to stand 11% up on a year ago.
“Overall non-residential projects rose 2% against the preceding three months on a seasonally adjusted basis and were 8% higher than a year ago. Starts were boosted by year on year increases in industrial, office, retail, hotel & leisure and health projects, although office and health starts were weaker than during the previous three months. Education starts dropped 20% against the previous three months to stand 3% down on a year earlier, while the value of community and amenity projects were at half the level of a year ago.
“Civil engineering starts rose 13% against the third quarter on a seasonally adjusted basis and were 10% higher than a year ago. The rise reverses the recent weakening in project starts and was led by a sharp increase in the utilities sector with starts rising 28% against the previous three months. Infrastructure starts rose 9% over the same period.”
Regionally growth in project starts was confined to the East of England, North East, West Midlands and Yorkshire & the Humber which saw increases of 41%, 13%, 45% and 31% respectively against a year ago. Starts in Northern Ireland, the South East and Wales were slightly weaker while other parts of the UK all saw a double digit decline in project starts.