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Housing activity highest since records began

Housing increase
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Housebuilding output has reached a new high, according to official figures

The Office for National Statistics (ONS) published data showing that £3.23 billion of housing construction activity took place in November 2017.

The seasonally adjusted figure was the highest since monthly records began at the start of this decade, beating the previous peak of £3.18 billion in March last year. 

It represents a 4 per cent rise on the previous month, and an 8 per cent hike from the same month a year earlier.

Private housing led the charge, reaching new heights of its own with £2.78 billion of output in November 2017. Public housing was up slightly to £451 million.

Meanwhile construction output as a whole grew by just 0.4 per cent in November. Infrastructure levels fell, as did industrial output, while commercial and public sector buildings work grew marginally.

The private housing sector was the only one of the six sectors measured by the ONS to see growth on a three-month rolling basis. While private residential output was 1.2 per cent higher in the three months to the end of November than in the three months to the end of October, all other areas of the construction industry saw a fall over that period.

The industry as a whole shrank by 2 per cent in the sme period, its biggest drop in more than five years.

Rebecca Larkin, senior economist at the Construction Products Association, said: ‘Today’s data confirms what has been signalled by early indicators and industry surveys – that construction ended 2017 on a weak note. Past falls in new orders, particularly in the commercial and public non-housing sectors, now appear to filtering through into lower volumes of work.

‘It now looks impossible that the industry avoided a full quarter of contraction in Q4 2017, with the £30 billion private housing sector contributing the only positive story. Therefore, construction is set to have caused a drag on overall UK economic growth during the quarter.’

The private housing sector contributed the only positive story

Blane Perrotton, managing director of surveyors Naismiths, said the housing sector was sugaring anincreasingly bitter pill’ for construction.

‘Both commercial property and infrastructure construction suffered a steady loss of momentum during 2017, as investors have continued concerns over the future course of the economy,’ he said.

‘Housebuilders continue to bet on future demand from would-be homeowners, and on the front line we’re seeing very brisk residential activity – especially among developers converting office buildings into residential units.’

Mark Robinson, chief executive of public sector frameworks body Scape, called for new housing minister Dominic Raab to instigate a ‘revolution’ in council housebuilding.

’While private housebuilding remains positive, the output of public housebuilding is still far too low to even come close to addressing the shortage of affordable housing,’ he said.

’Theresa May has just named the seventh housing minister since 2010 in the midst of a nationwide housing crisis, and I urge the new minister to look seriously at the role local councils can play in affordable housing delivery. We need a revolution in council housebuilding, and this means greater resources and powers for local councils. I hope the minister is the right man for the job.’

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Readers' comments (1)

  • More Lies, Damn Lies, and Statistics? There is always a housing crisis, just as the NHS is always in Crisis, as is education and industrial output.

    Perhaps we need designers and builders with clients who want to build on convenient land? And let them get on with it?! Long life, loose fit, low energy; as we used to say in the 1970s? And perhaps make use of all the vacant property? Simples?!

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