Featured Sector: Social Housing

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

Sharp reductions in Government capital funding have weighed heavily upon sector activity. Official data shows that the volume of public new housing output during 2012 was 19% down on the previous year.

Against this negative trend Glenigan recorded a strengthening in project starts in during the closing months of 2012. Indeed social housing starts during the final quarter were 48% up on a year earlier. In addition the value of detailed planning approvals was 62% higher during the same period.

The pick-up in activity during the final months of 2012 was driven by social landlords pressing on with estate renewal programmes, combined with a number of student accommodation projects. Whilst these are expected to support sector workload in the near term, the sector outlook remains harsh given the reduction in Government funding for new build projects.

We anticipate a renewed weakening in project starts during 2013. Indeed recent months have seen a renewed weakening in project starts which were 20% lower during the three months to February compared to the same period a year ago.