Construction tender prices fell again during the first quarter of 2010, and are now 16% below their peak in Q4 2007, according to the latest UK Construction Tender Price Index compiled by BCIS.
With nationally agreed wage rates rising 1.9% and materials costs rising by 1.7% in the year to Q1 2010, the fall in tender prices shows the mounting pressure on construction firms to secure work.
However, the steady decline may level out soon. A BCIS survey of contractors showed that the majority were expecting tender prices to remain static over the next six months.
Peter Rumble, information services manager at BCIS, said: "Currently BCIS is expecting a further small fall in tender prices in Q2 2010, followed by stagnation in prices for the remainder of the year.
“A small rise in tender prices is expected in the year to Q2 2011, rising more or less in line with input cost increases over the following year, as a slow recovery in new work output gets underway."