North hit hardest by downturn

Apr 8 2008 by Sue Scott, Evening Gazette

A SLOWING housing market has hit the UK construction industry, making it even more unlikely that the Government will reach its housing targets, an RICS UK construction market survey has shown.

Growth in construction work fell to the lowest level for more than a decade as housebuilders and businesses were hit by the effects of the credit crunch and housing demand fell. It was the worst level since 1996 with 1% more chartered surveyors reporting a rise than a fall, down from 16% in the fourth quarter of 2007. Hardest hit was the north of England.

Private housing was worst affected with workload growth negative for the first time since 1999. That was due mainly to a downturn in the North, but private housing weakened in all regions and was static in London and the South-east, Wales, the Midlands and Northern Ireland. Nine per cent more chartered surveyors reported a fall than a rise in the sector workloads.

The chairman of the RICS North-east region, Michael Henning, a chartered surveyor with Summers-Inman, Newcastle, said: “Looking around the region, you will still see a great deal of regeneration work being carried out. However, it’s three months, six months and a year down the line that people in the industry are concerned about.”

But he said property professionals in the North-east, while not optimistic, were not pessimistic. “There is a strong commitment to regeneration in the region and companies are realistic. They will work through the downturn on the basis the market will in time stabilise and begin to rise again.”