Housebuilding Set to Stay Busy Despite Market Uncertainty

Posted by Glenigan on 30th January 2023 -

Despite the pessimistic outlook for house prices, there remains a significant volume of construction activity in the pipeline on housebuilding sites and the sector continues to offer opportunities for new contracts.

Despite the financial market chaos caused by October's Mini-Budget, Glenigan data shows that the immediate outlook for housing construction activity has been largely undisturbed. Detailed planning approvals for underlying housing projects (worth under £100 million) in the three months to November fell by only 1% compared to the previous three months. Meanwhile for all housing schemes, total detailed planning approvals actually rose 17% during the same time frame.

Planning approvals in London

London has been the busiest area for detailed housing planning approvals, which bodes well for construction activity in the capital in 2023. The December Glenigan Construction Review reported that planning approvals for housing projects in London rose 64% in the three months to November on the same period a year earlier, accounting for almost a quarter of the national total and worth over £3 billion.

The major volume house builders are also set to maintain significant - albeit reduced - levels of completions this year, despite the cooling in the new homes market. One of the largest quoted groups, Barratt Developments, said earlier this month that if its’ home reservation rates increased over the spring in line with normal trading patterns it would be on track to complete some 17,475 homes in its current financial year running up to next June. Even without a seasonal improvement, it expects to deliver 16,000-16,500 completions.

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