Housing starts drop off

The forecast point to around 47,000 starts this year, a fall of 27% from 2007.

Private sector housing starts are forecast to be down by 30% to the lowest level since 1992. Social housing programme is failing to grow in line with government’s plans for 45,000 new homes a year by 2011.

Previous expectations that the industry would grow in 2008 have now been reversed and output is expected to decline by 1.3%.

Prospects remain good for construction work on infrastructure projects. Contracts are now being let for the major Building Schools for the Future programme and work has started on building the Olympics projects. But the growth in these sectors is more than outweighed by the decline in the housing market, a sharp fall in investment in new industrial buildings and a reduction in the repair and improvement to existing social housing.

Michael Ankers, chief executive of the Construction Products Association, said that the market is expected to pick up in 2010, but the present impact on new-build has been more severe than anticipated. “Unless something is done urgently to address this problem, the capacity in the industry will be cut to a level which will take a long time to build up and it will not be able to meet the inevitable pent up demand for new housing.”