Data from the CPA/Barbour ABI index shows growth across several different sectors
The CPA/Barbour ABI contract awards index was 119 for June and for the second quarter of 2013 as a whole, 7% higher than in the first quarter. It seems strange to think about in the current heatwave, but this is growth partly due to the poor weather in the first few months to the year.
It is particularly good to see that the growth is across quite a few different sectors. The indices for June, compared with a year ago, rose across private housing, education, hotels, factories and warehouses construction.
Of course, a lot of this growth is in London and the South-east but there are also pockets elsewhere, such as in the M62 corridor around Manchester and Liverpool.
But it is not all good news. Health work fell 10% in Q2 and, of greater concern, work in the commercial offices and retail markets, especially outside of London, continued to fall sharply.
Private Housing Index: Confidence is rising - and not just in London
It was only a few months ago that the doom-mongers were openly slating the government鈥檚 Help to Buy, which started in April. Whatever the rights or wrongs of it long term, it has built upon the rises in property transactions and house prices from previous policies such as FirstBuy, and given major housebuilders confidence that demand will be sustained.
As a consequence, housebuilders have raised supply and the private housing CPA/Barbour ABI index in June was 174, 36% higher than a year earlier. Until now housebuilding has risen in London and the South-east but optimism, although still fragile, appears to be spreading, with June the first month in which house prices rose in all regions since 2008.
Furthermore, NHBC registrations in the three months to May were at a five-year high with rises in most regions. London still dominates, of course, with house prices in June 19% higher than the pre-recession peak, and this is undoubtedly where housebuilders will continue to focus. But the signs are that a private housing recovery is potentially in place for the whole country.
Noble Francis is economics director at the Construction Products Association
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