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Housing starts plummet by a quarter

Housing down downturn drop
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Housing starts on site have fallen by their sharpest level for over a year, new research has revealed

The sector scored 154 on the much-watched Glenigan Index in June this year, down a whopping 25 per cent on the same month a year earlier.

According to the industry tracker, private housing starts were down 18 per cent over that period with new social housing projects plummeting 42 per cent. The Glenigan Index measures new starts on site over the preceding three months and excludes both very large and very small schemes.

With non-residential buildings schemes and civil engineering starts also down, the overall construction index fell 21 per cent to 120.2 in June.

Glenigan economics director Allan Wilén said: ‘Disappointingly, the progressive decline in the value of underlying starts in recent months continued during June.

‘The index reveals a general decline in project starts during the last three months, most notably in housing, industrial, commercial and civil engineering projects. However, against this downward trend, project starts in the education, health and hotel and leisure sectors were little changed or up on a year ago.’

The overall drop in construction starts was widely felt across the country, with Northern Ireland the only part of the UK to see a small rise in the value of new projects.

London recorded the steepest fall, with the value of construction starts in the capital more than halved from a year ago.

However, the misery was tempered by findings in the respected Construction Purchasing Managers’ Index that residential work was the best-performing sector as output rose sharply in June.

The report – from the Chartered Institute of Procurement & Supply with research firm Markit – revealed an index reading of 53.1 last month, representing the sharpest month-on-month increase in overall construction activity this year.

Report author Tim Moore said: ‘The latest increase in UK construction output marks three months of sustained recovery from the snow-related disruption seen back in March. A solid contribution from house building helped to drive up overall construction activity in June.’

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