A 3% fall in private house-building output and a 5.7% fall in private housing repair & maintenance were the main contributors to April’s overall decline in construction output.
However, across the three months to April 2023 construction output saw an increase of 1.6% over the previous three-month period. This was the eighth consecutive three-month period of growth and came from a 5.7% rise in repair and maintenance as new work saw a decrease of 0.9%.
ONS figures also show that materials prices rose 8.4% in the first four months of the year, with inflation levels slowing to 4.7% in April.
Clive Docwra, managing director of property and construction consultancy McBains, commented: “After last month’s figures fuelled hopes of green shoots of recovery, today’s statistics will come as a blow to the construction sector.
“Particularly disappointing was that the fall was as a result of a decrease in new work, suggesting that confidence remains low among many big investors.
“It’s little surprise that private housing continues to struggle, and with falling house prices and low mortgage approval rates it will take some months before volume house-building shows a turnaround.”
Paul Sloman, engineering and construction sector leader at PwC UK, said: “April’s slight fall in output may precede worrying signs of a larger contraction in the market, a signal housebuilders could be holding back on new projects.
“The fall will add another building block of concern for those hoping to take a step onto the housing ladder, a significant blow despite signs that the economy may be taking a positive turn with an increase in growth.
“With the ONS stating the anecdotal evidence suggested a continued slow-down in private housing, referencing economic worries with customers hesitant to request work; housebuilders have some concerns about the continued challenging outlook in the sales market.
“Whilst it is encouraging that construction output saw an increase of 1.6% in the three months to April 2023; the increase came solely from a rise in repair and maintenance works (5.7%), this again prompts debate around the rate and scale of new construction projects getting underway, with new work experiencing a decrease of 0.9%.
“With estate agents and housebuilders bearing the brunt of the slowdown, plus the continued concerns about the lasting effect of higher interest rates, it seems that despite the positive economic news today, housebuilders are not quite out of the woods yet.”
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