The latest figures from construction industry tracker Glenigan reveal a decline in the value of residential contracts
The latest 12-month rolling total for May 2009 shows the value of contracts has fallen by £207 million to £3.89 billion, compared to the 12-month figure for the period ending April 2009.
The results run counter to several ‘green shoots’ reports in the media this week, which suggested that the housing construction market has bottomed out. Housebuilder Bellway Homes has reported that the South of England in particular is showing signs of recovery, and Bellway is starting to buy land again.
However, Richard Nelson, business development director at AJ100 firm Watkins Gray International, said: ‘We have had several schemes go on hold over the last year and a half, and while some of them seemed to be gearing up again, due to renewed financing talks with the Homes and Communities Agency, many have taken a step backward again as the agency reconsiders how to finance the projects.’
Tim Hall, director at AJ100 firm Lewis and Hickey, said the drop – which reversed a surprise increase the previous month (AJ 14.05.09) – was due to inadequate capital. ‘There are still too many empty apartment buildings out there and not many funds willing to back speculative developments.’