The Government must not be complacent about the damage a ‘no deal’ Brexit would cause amid positive signs of growth in the UK construction industry, says the Federation of Master Builders (FMB).
Commenting on the construction output figures for November 2018, published by the Office for National Statistics, Sarah McMonagle, Director of External Affairs at the FMB, said: “The UK construction sector grew by 2.1 per cent during September to November 2018 compared with the previous three months. This is despite unparalleled levels of political uncertainty around the very real prospect of a ‘no deal’ scenario. However, we are urging the Government not to allow these results to create a false sense of security. Since November, political uncertainty has cranked up and is increasing every day. A growing and prosperous construction sector will be a distant memory if the Government allows the UK to crash out of the EU without a deal in place.”
McMonagle concluded: “The construction industry is also extremely concerned about the Government’s proposed post-Brexit immigration system. In the Immigration White Paper, published at the end of last year, the Government revealed that they will make few allowances for low skilled workers to enter the UK post-Brexit. Most tradespeople will be defined as low skilled and therefore will not be permitted to enter the UK, regardless of whether they are from the EU or further afield. It is crucial that the Government introduces a post-Brexit immigration system that continues to allow us to draw on essential migrant workers or else their house building and infrastructure targets will be totally unachievable.”
Official figures released today have revealed that the UK construction industry has continued to grow over the last quarter despite uncertainty around Brexit.
The IHS Markit/CIPS UK Construction Total Activity Index posted its second-highest level in 16 months at 53.2 in October, up from 52.1 in September.
However it was still some way below the long-run survey average of 54.3.
This was in part due to a slowdown in housebuilding across the UK which has put a drag on the construction industry.
Blane Perrotton, managing director of the national property consultancy and surveyors Naismiths, said: “The construction industry is enjoying an Indian Summer.
“True, the surge in output in the third quarter is flattered by comparison with the grim decline of the first quarter and the plodding indifference of the second. But this is real, and welcome, progress.
“Housebuilding retains its crown as both poster child and ‘get out of jail’ card for the industry as a whole. Housebuilders delivered a half billion boost to the industry in the third quarter, but elsewhere the growth was patchy at best. Infrastructure work remains in positive territory but output is down, with contractors focusing on finishing existing projects rather than starting new ones.
“Among developers there is a widening confidence gap between the overheated South East and other areas where demand is stronger and margins better.
“Despite a marked improvement in the Brexit mood music this week, months of deadlocked negotiations have choked investor appetite. Unless and until the political limbo is ended, the industry will continue its holding pattern of two steps forward and one step back.”
The UK residential land market is reflecting the shape of the housing market, as values fall in central London but continue to rise in other regions, with Scotland the standout performer, according to international real estate adviser Savills.
Across the UK, greenfield and urban land values have grown by 1.9% and 6.9% respectively over the past year, albeit values remain 13 and 23% below their pre financial crisis level.
Growth has been supported by the strength of the Scottish land market, where annual growth stands at 6.0% and 6.2% respectively and greenfield values rose 1.0% in the last quarter alone, and urban land values by 2.5%.
A scarcity of developable sites in Scotland’s most in-demand locations, particularly in and around Glasgow, has led to increased competition for land, underpinned by house price growth of 7.7% year on year, well ahead of the 3.8% UK average.
Jamie Doran, Savills development director, said: “A strong Scottish housing market, particularly in Glasgow and Edinburgh, has fuelled demand for well-located development sites: the key challenge is the availability of developable residential land in these areas. The lack of supply of sites with planning consent is driving value. Value rises are greatest in prime hotspots within the city, ie the south –side of the city and West End, but also in the city centre where there a number of new developers entering the market.”
Emily Dorrian of Savills Research said: “The Scottish Government’s More Homes Policy is looking to deliver 50,000 new affordable homes by 2021, supported by increased access to grant funding. This is encouraging registered social landlords and local authorities to become more active within the development market. Further, the Help to Buy programme in Scotland is supporting the private sector in delivering units up to £200,000, a key first time buyer threshold.
“North of the Border, developers also do not have access to the same suite of infrastructure funds to support the development of land where significant remediation or infrastructure is required. This, along with planning consent, is constraining the delivery of housing at certain sites in Scotland.”
Controversial plans for 164 houses on land off Otley Road have moved a step closer. Council officers have recommend that the plans are approved – but Shrewsbury Town Council has objected to the development, with the mayor today saying the town deserves better quality houses.
The plans are part of a much larger scheme of up to 550 houses, commercial development, a hotel, a care home of up to 70 beds and supporting local centre and community uses.
Work will also involve the building of new estate roads and associated highways works, associated infrastructure, associated earthworks, and landscape works including informal open space and children’s play area, which were given outline permission in 2015.
Shrewsbury Town Council has objected to the plans for the houses and said that there are not enough open spaces, lack of parking, and lack of affordable housing.
Shrewsbury’s mayor Jane MacKenzie said she will personally be objecting over the lack of quality and she said she is organising a public meeting to set up a list of principles for quality development to be handed to developers at the first stage of a planning application.
She said: “I’m going to be objecting over the quality of the building, the lack of imagination and the low standards that property developers seem to be getting away with.
“We’re hoping to set up a meeting next month and develop a list of principles which will go to Shropshire Council’s planning department and be handed out to developers at the first stage of the planning process.
“We’re getting the same old developers thinking they can just push something through that doesn’t support the culture and heritage of Shrewsbury.
“It’s very disappointing, people deserve better. It’s about the next generation not us.
“I’m organising the public meeting for people who are tired of what’s happening in Shrewsbury with the development.
“We need development, but just better quality development.”
The public meeting will take place at The Guildhall on April 28.
Bellway Homes Ltd have applied to build the homes which would consist of 15 two bedroom houses, 72 houses with three bedrooms, 52 houses with four bedrooms, which would all be private housing.
There would also be a number of affordable homes including four one bedroom apartments, 14 two bedroom houses and seven three bedroom houses.
Shropshire Council’s central planning committee will make a decision on the plans on Thursday in Shirehall.
Seventeen new houses could be built on a field near Vale School in Guernsey.
The island’s Planning Department have submitted a framework for developers to build on the agricultural land at Camp Dolent on Tertre Lane.
The site is 5-10 minutes walk from St Sampson main centre with Vale School and petrol stations nearby.
The Draft Development Framework gives a wide-range of guidance on the use of the plot, including:
Neighbouring residential development – There are no immediately adjoining residential properties. However, new development must respect the residential amenity of neighbouring properties to the south and west of Tertre Lane, including consideration of privacy and overlooking.
Access – The existing vehicular access is not suitable for a residential development of the scale proposed. Development on this site provides an opportunity to enhance pedestrian safety and access by providing a public footpath along Tertre Lane.
Design- Two storey buildings constitute a more efficient use of land than single storey buildings and therefore development proposals should consider a multi-storey design from the outset.
Renewable Energy – Proposals for the incorporation of renewable energy installations into the design of the development, such as solar tiles, is encouraged.
Based on the site, the Framework predicts between 8-17 dwellings.
Islanders are being asked to give their views before Friday 6th April.
Output in Britain’s construction industry fell at the fastest annual pace for five years in January as a slowdown in commercial developments and house-building hit the sector hard.
Figures from the Office for National Statistics show that output fell by 3.9%, the biggest year-on-year decline since March 2013.
Monthly figures also made for grim reading, falling 3.4% between December and January, while new orders decreased by 25% in the fourth quarter.
Economists had expected a monthly decline of just 0.5%.
“Construction continues to be a weak spot in the UK economy with a big drop in commercial developments, along with a slowdown in house-building after its very strong end to last year,” ONS senior statistician Ole Black said.
Investment in commercial developments, particularly in London, has fallen off a cliff since the Brexit vote as higher construction costs and uncertainty has seen developers delay new schemes.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “Commercial work will continue to fall if, as we expect, progress in Brexit talks remains slow.
“We doubt that house-building will recover fully soon. The prospect of further increases in interest rates is subduing buyer demand both for new and existing homes.”
The ONS data dump also included figures which show that Britain’s industrial production rebounded in January following a boost in manufacturing and North Sea oil and gas production.
Manufacturing grew 0.1% in January month on month, representing the ninth month in a row of growth for the first time since records began in 1968 as factories benefit from strong global demand and a weak Brexit-hit pound.
Industrial production grew 1.3% in January, with growth driven mainly by the reopening of the Forties oil pipeline, which was shut down for three weeks after a crack was discovered in December.
Mining and quarrying provided the largest upward contribution, increasing by 23.5%.
“Manufacturing has recorded its ninth consecutive month of growth but with a slower start to 2018. Total production output continues to advance, bolstered in January by the Forties oil pipeline coming back on stream after December’s shutdown,” Mr Black added.
Figures also showed the UK trade deficit widen by £3.4 billion in good and services to £8.7 billion, with the ONS citing rising oil prices making for more expensive fuel imports, which rocketed 21.4%.
This contributed to a £3.2 billion widening of the trade in goods deficit.
THE UK construction sector showed only marginal growth in February amid “entrenched political uncertainty”, as a soft patch for housebuilding continued and civil engineering activity fell, a key survey shows.
Commercial property construction was the bright spot in the sector, recording its fastest increase in activity since May last year.
The Chartered Institute of Procurement & Supply’s purchasing managers’ index edged up from 50.2 in January to 51.4 last month on a seasonally-adjusted basis.
This took it further above the level of 50 deemed to separate expansion from contraction but the February reading nevertheless signals only slight growth.
The UK construction sector’s new business volumes fell in February, the survey shows.
Howard Archer, chief economic adviser to the EY ITEM Club think-tank, said: “The purchasing managers’ survey indicates that the construction sector is having a lacklustre start to 2018.”
He added: “February’s reading was still only slightly above the 50 level that indicates flat activity.”
Tim Moore, associate director at IHS Markit and author of the construction survey, said: “The construction sector endured another difficult month during February, with fragile business confidence, entrenched political uncertainty and softer housing market conditions all factors keeping growth in the slow lane.
“Residential work appears on track to experience its weakest quarter since Q3 2016, suggesting that housebuilding is losing its status as the main engine of construction growth.”
Five hundred new council homes will be built in a borough over the next three years as part of a major investment to boost the housing stock.
Sandwell Council will embark on one of the biggest council house building projects in years in a bid to tackle its growing waiting list.
Bosses said housing was among their main priorities, with £70 million to be ploughed into new developments until 2021.
Extensions to existing council properties are also planned.
CCTV could also be rolled out at high-rise blocks as part of the improvements in a bid to tackle antisocial behaviour.
The authority is also planning to create hundreds of school places over the coming years to deal with the borough’s rising population.
Some council house projects are already in the pipeline, including plans for 63 properties in Strathmore Road and Henn Street, Tipton, and another 50 in Friar Park, Wednesbury.
Wednesbury councillor Peter Hughes said the housebuilding programme was a signal of the council’s intent to improve living standards.
He said: “It has been decades since local authorities have built to the extent that we are.
“Sandwell is probably leading the way in terms of local authority social house building.
“There is a massive need for social housing. As a former housing manager myself I’m very much in favour of seeing house building take place. A lot of local authorities haven’t done it for some time.”
Councillor Hughes said despite the huge outlay on creating new homes, it would also prove beneficial for the council.
He said: “We will get an increase in council tax and we will also get the new homes bonus coming in which is quite substantial.”
The house building drive comes after councillors gave the green light to plans that will see around £52 million spent on external improvements to 13 high-rise blocks across Oldbury, Rowley Regis and West Bromwich starting this year.
First in line is Alfred Gunn House in Oldbury, with improvements also planned for Darley House, Moorlands Court, St Giles Court, Addenbrooke Court and Wesley Court in Rowley Regis; Heronville House, Paget House and Wyrley House in Oldbury and Holly Court, Oak Court, Allen House and Boulton House in West Bromwich.
Building what would be the fourth new housing development in a Nuneaton community has caused fury among residents.
Weddington’s ability to cope with demand for new school places as well as the impact on the roads has once again been the biggest concern aired by readers following the news that Gladman want to build up to 775 homes on land off Weddington Road.
Telegraph readers took to social media in their droves to react to the news of the development, which would be the fourth new one in the area.
What readers had to say
The plans were described as “utter madness” by Weddington ward councillor Keith Kondakor and it was a sentiment shared by Andrea McDonnel l on Twitter, who said: ” Absolutely agree! How can the current infrastructure cope?! Children struggling for schools, waiting times for doctors and sitting in queues of traffic to get to and from work #madness.”
On Facebook, Nick Groot Smith said: “They need to sort the town access out before any more homes are built.”
Liam Dunn wrote: “Wanna build more houses, yet you can’t fill potholes properly!”
Kerry Orton posted: “Have we not reached the housing target for the next ten years already? Surely we can’t be far off! And any sign of an approved Borough Plan yet?”
While Dan Holdaway said: “How? There is no way to widen the roads in a heavily built residential area? The roads will not change.”
Christopher ‘Suggsey’ Smith posted: “Yet more well used footpaths and bridleways in the countryside to be swallowed up by another development on green belt land. Time for everyone to say no, enough is enough!”
Gladman has said that, at the moment, the plans are in the very early stages and the leaflets sent out locally form part of their consultation before they officially submit the proposal to Nuneaton and Bedworth Borough Council .
What is known is that, at the moment, the latest round of inspection is taking place into Nuneaton and Bedworth Borough Council ‘s crucial Borough Plan, which maps out where houses can be built over the next 15 years.
Until the government inspector decides if the plan is ‘sound’ and fit for purpose, the council has little defence in the face of applications for housing developments.
Residents in a Chelmsford village have criticised property developers after they relaunched an application to build more than 100 homes and expand a primary school.
Bellway Homes has submitted new plans to build on a greenbelt site at the bottom of Aragon Road in Great Leighs.
The application also outlines proposals to expand Great Leighs Primary School on the same road.
The new plans come just two months after Bellway’s initial proposal to build 205 houses on the same site were refused by Chelmsford City Council after they deemed the site “unsuitable for development”.