- The total value of UK construction contracts awarded in January was £5.6 billion based on a three-month rolling average – a 36.5% increase on the value recorded in January 2013
- The number of construction projects within the UK in January was up 59.3% on December and 19.6% on January 2013
- Residential had the highest proportion of contracts awarded by value in January with 36% of the UK total
- The majority of the contracts awarded in January by value were in London, which accounted for 29% of the UK total
Growth in the UK construction industry continues to be driven by house building in the capital, according to new data published today. Overall construction activity rose by 59.3 per cent in January, with house building now accounting for more than a third of all UK contracts awarded by value.
The residential sector continued to show significant growth last month, with the total value of projects awarded reaching £1.87 billion, a two per cent increase from December and a huge 87.7 per higher than the corresponding month last year. 36 per cent of all residential contracts awarded were based in London, with key projects including the £180 million Clarges Estate redevelopment in Mayfair, 500 new housing units at Granville Road worth £140 million and the previously named Oakmayne Plaza and Tribeca Square £128 million residential scheme in Southwark.
These latest figures, taken from Barbour ABI’s Economic & Construction Market Review, highlight sustained growth in the residential construction sector, which continues to be boosted by initiatives such as the Government’s Help to Buy scheme. This is also backed up by recent ONS Construction Output figures and positive news from developers such as Bovis Homes and Taylor Wimpey, who have reported strong trading updates this month.
On the findings of the report, Michael Dall, lead economist at Barbour ABI, commented:
“Residential construction has been a major factor in the growth of the UK construction industry over the past year, so it’s no surprise to see that the sector now accounts for more than a third of all contracts awarded.
“It’s clear that Government initiatives such as Help to Buy and record low interest rates are having a positive impact, but there is still concern that demand for new homes far outstrips the rate at which houses are coming onto the market.
“This month, the Labour Party outlined proposals to build at least 200,000 homes a year by 2020, and the issue is likely to be high on all the political party’s agendas as we head into the next election.
“Hopefully the sector’s prolonged resurgence will help to drive wider economic growth as we look forward to the second quarter of 2014.”
The Economic & Construction Market Review is a monthly report designed to give valuable, current insight into UK construction industry performance. The Review is compiled from Barbour ABI’s records of construction data for every UK planning application, and key indicators, such as the Office for National Statistics’ Construction New Orders data.