Brickonomics

The RICS has put an extremely upbeat spin on its latest monthly housing market survey despite the continued collapse in sales. The survey highlights the clear 20% majority of optimists over pessimists among the surveyors quizzed in October about future prospects for sales. This +20 balance in favour of sales increasing in the months ahead, if well founded, may be the first glimmer of hope that the market may be about to lift from its torpor. It is the most…

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The futures market has downgraded it expectations for house prices which now points to a fall in cash terms of more than 40% from the peak in August last year to the bottom of the market in 2011. According to Tradition Future HPI an average house measured by the Halifax index will drop from £201,081 in August 2007 to £114,347 in October 2011. In real terms that is a drop of more than half.

The prospects for the global economy are declining so fast that it has prompted the updating of an IMF forecast released just last month. The prospects for the UK now look decidedly gloomier to the IMF, which has revised its forecast of 0.1% fall in GDP to a fall of 1.3% for next year. To put that in perspective, it is a deep as the drop in GDP in 1991 and suggests that the UK will be the worst performing…

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The financial stress within construction firms caused by the credit crunch is made stark in the latest official insolvency figures. And the problems facing the sector are being increased as property firms collapse in massively swelling numbers. Between July and September this year there was an increase of almost two thirds in the number of construction firms falling into receivership, administration or company voluntary arrangements in England and Wales, compared with the same period a year ago. With regard to…

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Naturally we wish the new US President Barack Obama well in the tough job he has ahead and in his commitment to boost the nation’s construction industry in a bid to improve the massive yet increasingly tatty infrastructure. From the news there would appear to be an international surge in happiness following his election victory. But I would also like to offer best wishes to King Jigme Khesar Namgyel Wangchuck, the 28 year-old Oxford educated newly installed head of state…

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The September figures for new construction orders are truly shocking and extremely worrying. In the past I have tended to treat the orders figures with a bit of disrespect because they bounce around to the point where you can’t make sense of them. Not now. Put bluntly from May onward, the industry has witnessed new orders running at 20% less than they were up to April. The have fallen off a cliff. But, leaving aside the continuing horror show in…

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House prices fell 2.2% in October to the level they first reached more than three years ago, according to the latest Halifax figures. But how far can they fall?

I recently mentioned the “skyscraper index” to a colleague. He hadn’t heard of it. I deduced he has better things to do than keep up with quirky economic indicators – what, I can’t imagine. Anyway, it occurred to me that, if he hadn’t heard of it, others also might not have. So for those unaware of the index here is another to add to the pile of forewarnings of the current economic carnage. The skyscraper index was developed in 1999…

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The recession in construction is looking increasingly desperate as the giant commercial sector appears to be heading for a nasty fall. The latest round of data will be a massive body blow to those who sought comfort in the notion that the recession in construction might limit itself mainly to housing. The release of the construction survey by the buyers’ body CIPS and yesterday’s commercial market survey by the surveyor’s body RICS both point clearly to a potential shuddering slowdown…

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If the definition you use is two quarters of negative growth, then on the first count by the national statisticians the construction industry is in a recession. The latest GDP figures show that growth in the whole economy dipped by 0.5% in the third quarter. This was the first fall for 16 years and has ended the period of uninterrupted growth for the UK economy much repeated by Gordon Brown. But the estimates made for construction puts output down by…

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