果冻影院

South East construction work should edge into positive territory in 2018 despite uncertainty in the housing sector.

果冻影院 expects the Midlands and northern England to produce the most positive performance in terms of construction project starts in 2018. The South East is the only other region expected to produce growth, but this will be more muted.

鈥淲e are cautious for the prospects for sector starts during the year as a whole,鈥� says 果冻影院's economics director Allan Wil茅n. 鈥淲e anticipate that the weakening in office and private housing activity will continue to hold back any significant growth in project starts in the South East this year.鈥�

The balance of respondents expecting a rise in workload in the South East grew in the Federation of Master Builders鈥� Q2 2018 survey. This confidence was borne out by 果冻影院鈥檚 New Housing Pipeline Q2 2018 report for the Home Builders Federation, which shows that the underling value of starts in the South East rose by 14% in the quarter to October 2018.

Sector breakdown

The building sector producing the strongest growth in construction starts in the South East in the first 10 months of 2018 was social housing, where starts rose 28%. Retail starts also rose 17%. Mr Wil茅n adds: 鈥淲ith online retail customers increasingly expecting next day or even same day delivery, we expect to see a partial shift from large distribution warehouses to more, smaller logistics centres within short distance of large markets.

鈥淭his will be especially evident around the London fringe, stimulating demand for industrial space in parts of the South East.鈥�

There has also been a surge in utilities work, but private housing projects drive construction in the region. In 2017, 39% of projects by value to start on site in the South East were for private housing.

However, that 拢3.2 billion-worth of private residential projects to break ground in the South East last year was down 12% on 2016.

Private housing the key This year has brought an improvement in private housebuilding despite ambiguity over Brexit and the future of Help to Buy.

In September, Berkeley, which operates in London and the South East, cautioned that the region 鈥渓acks urgency鈥� but starts still subsequently managed to grow, but the pipeline of residential work has faltered.

National House-Building Council data shows starts on new homes in the South East rose 7% to 7,128 units in Q3 2013 compared to the same period a year ago.

However, 果冻影院鈥檚 construction analysis shows that the 14,560 units given detailed planning permission in Q2 2018 was down 30% on the preceding quarter.

The Home Builders Federation cited uncertainty over the future of Help to Buy, which was due to end in 2021, as a significant factor for this fall.

With HTB now extended to 2023, subsequent updates should prove more positive for a region so heavily reliant on private housing work and augurs well for growth.