Property market slowdown prompts fall in construction

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by Kay Murchie

A survey by the Royal Institution of Charted Surveyors (Rics) shows a decline in construction as a result of the slowdown in the UK housing market.

The Rics UK construction market survey has established just 1% more surveyors are reporting an increase in workloads rather than a fall in the first quarter of 2008, when compared to the fourth quarter of 2007.

Growth in the construction industry has slowed abruptly in the first quarter of 2008, according to David Stubbs of Rics.

Private residential workloads are now shrinking as home builders react to challenging conditions in the housing market by reducing the number of new homes under construction, added Mr Stubbs.

This emphasises the difficulty that the Government will have in encouraging higher house building levels during periods when the housing market is soft, commented Mr Stubbs.

The Government announced plans last year to build 2 million new homes by 2016, with a further one million, carbon-neutral properties built by 2020. However, these figures are optimistic following a decline in construction.

Rics concluded by saying private housing weakened in all regions and is now static in London and the south-east, Wales, the Midlands and Northern Ireland.