Featured Sector: Private Housing

Underlying value of construction projects starting on site. (Excludes individual projects of more than £100 million and framework agreements).

2011 saw flat house prices, falling numbers of transactions and weak lending figures. Despite rises in housing completions, house building has been on a downward path. Since the summer of 2010, where a temporary recovery was providing optimism amid a gloomy construction industry, Glenigan has recorded falling levels of starts, a drop in the number of planning approvals and a lengthening in the time it takes projects to start on site having achieved planning approval.

The negative trend persisted until the summer of last year, when the value of starts stabilised and have since begun to rise. Over the first quarter of 2012, the underlying value had increased by 14%. We are expecting to see this type of growth continued through the year.

Regionally, the decline in housing construction was not evenly spread. Scotland suffered particularly over 2011, with a 22% drop in project starts. By contrast London, which accounted for a quarter of the value of private house starts last year, saw a 43% increase in building. As the sector improves this year, we may continue to see building concentrated in the south of the UK.