The construction outlook is the worst for a decade, according to a new survey by the Royal Institution of Chartered Surveyors (RICS).
The RICS UK Construction Market Survey says construction workloads fell to the lowest level for more than a decade during the first quarter as housebuilders and businesses were hit by the effects of the credit crunch and demand for new housing declined.
Worst hit was private housing, with workload growth turning negative for the first time since 1999.
The survey says the fall was mainly due to a downturn in the north of England, but private housing weakened in all regions and is now said to be “static” in London and the southieast, Wales, the Midlands and Northern Ireland.
Expectations of profit margins fell for only the second time in the survey’s history with surveyor sentiment falling sharply.
“Growth in the construction industry has slowed abruptly in the first quarter of this year,” said RICS senior economist David Stubbs.
“Private residential workloads are now shrinking as homebuilders react to challenging conditions in the housing market by reducing the number of new homes under construction.
“This emphasises the difficulty that the government will have in encouraging higher housebuilding levels during periods when the housing market is soft.”
