Housing Update

Housing Update

The Construction Centre.co.uk comments on the continued decline of the house building industry

Fresh reports today revealed that the construction industry suffered further last month with purchasing activity down to its lowest point for eleven years.

Housebuilders have been worst hit with Taylor Wimpey announcing 900 job losses, 13 office closures and struggling to find investors. The other major players such as Persimmon, Redrow and Barratt are continuing to weather increasing storm. The Construction Centre.co.uk said that the situation had not yet reached rock bottom for the housing market and that a minimum of another twelve difficult months lay ahead.

Despite the gloom for housebuilders, other areas of the construction industry were still doing well with an announcement from Balfour Beatty that trading was good and significant new orders coming in. The Construction Centre.co.uk said that infrastructure projects and work on the 2012 Olympics would help to ensure contractors remain in a strong position which would continue to support the UK economy.

The Construction Centre warned that the housing market, particularly in the public sector may suffer as a consequence of the housing market and the credit crunch. The government has already lost £1 billion in stamp duty from 2007 to 2008 and has predicted a further shortfall of £750 million over the coming year. Projects which were due to fulfil the government’s plans for 3.8 million new homes by 2020 may be shelved which will further serve to damage the stagnating market. Housebuilders are already reallocating some private developments to social housing in order to secure funding but with lower general taxation streams for the government, there is little room to manoeuvre and it is therefore folly to think the public sector will meet the new housing targets and fill the gap left by the fall in private sector development.

Richard Simmons, Managing Director at The Construction Centre said “We are now in desperate times. Housebuilders are on the brink of collapse, the banks are refusing mortgages and the economy is in no fit state to support the crisis. It is a spiralling vicious circle which can only get worse before it gets better. The really worrying part of all this is that even when the does market stabilise, the house building industry will emerge from this armageddon severely bruised and battered. The chance of improving existing housing stock production figures, which are already inadequate, is remote to say the least. If Taylor Wimpey can close 13 offices in one stride it would be foolish to assume they will re-open any or all of these quickly, if indeed ever at all.”

The Construction Centre said the whole of the industry should take time to dwell on the fact that whilst mass redundancies and office closures can happen overnight, these resources can take a decade to “grow back” or reinstate. It said the current statistics concerning housebuilders would inevitably have very long term implications for the industry and the flow of bad news was likely to continue for the rest of the year.

More information can be found at
http://www.theconstructioncentre.co.uk

Notes for Editors:

www.theconstructioncentre.co.uk

The Construction Centre: Number 1 for delivering results on products and people

Targeted at consumers and the building industry, The Construction Centre has the largest online directory containing over 10,000 UK product manufacturers and suppliers with over 97,000 product search terms. Additionally there are over 50,000 contact details for merchants, industry professionals, tradesmen and contractors. Local Authority planning websites, trade publications and jobs can also be directly accessed from The Construction Centre.

Based in Warwickshire The Construction Centre is part of the UK250 Ltd group.

Contact:

Angela Gallacher (Head of Press and Marketing)
Telephone: +44 (0)1926 865825
Address: 1 Alpha House, Farmer Ward Road, Kenilworth, Warwickshire, CV8 2ED
www.theconstructioncentre.co.uk