Rise in private housing activity drives construction starts

On a regional level, the West Midlands fared well with a 25% increase in project starts.

Overall there was a 6% rise in work getting under way in the three months to April, as a 26% jump in housebuilding work countered falls elsewhere, according to the industry's Glenigen Index.

Overall non-residential project starts were 7% down on the same period in 2016, as a weakening in office, education and community & amenity work offset growth in industrial and health projects. Civil engineering starts were 7% lower than a year ago.

Glenigan’s economics director, Allan Wilén, said, “The rise in project starts during the three months to April is encouraging and bodes well for construction activity during the year ahead.

"The 6% rise in starts is partly due to a bounce back in civils projects in March and April, together with encouraging increases in industrial and health project starts. However, the key driver for growth has been a marked strengthening in private residential projects.”

“Private residential starts for the three months to April were 36% higher than a year ago and were also a third higher than during the three months to January 2017 on a seasonally adjusted basis. This renewed strengthening in starts is encouraging and should help sustain sector activity during the current year."

Projects starts have grown sharply in the industrial and health sectors. A 35% rise in industrial project starts is seen as especially positive and suggests investors are now pressing ahead with projects that were initially reviewed after the EU referendum vote. But the strong growth seen in these sectors has been overshadowed by a weakening in other non-residential sectors such as offices, education and community & amenity.