UK construction growth will slow “significantly” in 2005, according to global economic forecasting group Experian.
The believes growth in construction output will slow to about 2% this year, down from 4% in 2004. It predicts a further reduction during 2006, before picking up to about 3% in 2007.
Assosciate director of the business strategies division James Hastings said: “Slower growth in 2005 and 2006 will be due in part to the weakness of the housing market and its effect on the level of new private housebuilding.
“We expect a combination of faltering house price rises and a stalling buy-to-let market to impact on consumer confidence and depress demand in the short-term.”
In contrast, Experian predicts public housing output to “steam ahead” as schemes to provide more affordable housing take off.
Meanwhile, public spending on non-residential buildings, particularly health and education facilities, is expected to moderate from the 20% year-on-year growth seen during the past three years. Private commercial output is forecast to see robust growth until 2007, buoyed by increased activity in the offices, retail and leisure sectors.
