Starts steady, but still down on a year ago

• During the three months to February, starts were unchanged on the previous three months on a seasonally adjusted basis, but were 11% down on a year ago.
• Residential starts slipped 4% against the preceding three months and were 16% lower than a year ago.
• Non-Residential starts improved, rising 8% against the preceding three months but were unchanged on a year ago.
• Civil engineering project starts dropped 16% on the preceding three months and were 31% lower than a year ago.

The value of work starting on site during the three months to February were unchanged against the previous three months on a seasonally adjusted basis and were 11% down on a year ago, according to the latest Glenigan Index.

Rhys Gadsby, Glenigan’s Economic Analyst, commented on this month’s figures. “The latest Glenigan index reveals that things have steadied over the last three months, but project starts are still down on a year ago. The more certain political environment has contributed to short term stabilisation and should continue to enable postponed public-sector projects to proceed to site. Improved investor confidence is expected to lift private sector investment and project starts over the coming months, although disruption from the Coronavirus is a potential risk to anticipated growth.”

“Residential starts further declined during the three months to February. Private housing starts fell 4% against the preceding three months on a seasonally adjusted basis and declined 12% compared with a year ago. Social housing starts dramatically slipped back on the previous three months by 24% on a seasonally adjusted basis, and by 28% on a year ago.”

“Non-residential projects improved against the preceding three months on a seasonally adjusted basis, climbing 8%, but were unchanged on a year ago. Key to this growth was Education starts, where starts grew 39% against the preceding three months on a seasonally adjusted basis, and by 31% against a year ago. Community & Amenity and Industrial starts also saw growth, with starts increasing by 48% and 8% on a year ago respectively. Retail, Health and Hotel & Leisure starts all slipped back compared with a year ago, falling by 36%, 14% and 13% respectively.”

“Civil engineering starts were 16% down on the preceding three months on a seasonally adjusted basis and were significantly down against a year ago (31%). Utilities starts were 32% lower than a year ago and were 26% down on the preceding three months on a seasonally adjusted basis. Infrastructure project starts significantly declined, being 9% down against the preceding three months on a seasonally adjusted basis and by 30% against a year ago.”

“On a year ago, most regions have seen a double-digit decline in starts. The North West, East Midlands and South West saw the greatest falls, with 41%, 35% and 20% drops respectively. Wales, the North East, South East and Yorkshire also saw significant declines. Bucking the trend were the East of England and West Midlands, seeing a 34% and 29% rise in starts on a year ago respectively. The two regions were the only ones to see growth against a year ago.”

Glenigan Indices (underlying* projects up to £100 million)