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Construction output falls for ninth consecutive month as housebuilding slows

The UK construction industry suffered a further slowdown in December, driven by a fall in housebuilding activity, as confidence remained low.

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Construction output fell for a ninth successive month in December according to the latest data from IHS Markit, and housebuilding fell for the seventh month running.

The IHS Markit/CIPS UK Construction Purchasing Managers’ Index (PMI), which is a measure of sentiment across the industry, fell to 44.4 in December, from 45.3 in November, indicating that confidence is still at a low.

Brexit uncertainty and spending delays ahead of the general election were once again the most commonly cited factors highlighted by firms experiencing a drop in construction activity,” Tim Moore, economics associate director at IHS Markit, said.


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“Civil engineering saw its sharpest decline for more than 10 years and remained the worst-performing area of construction work, followed by commercial development.

He added: “Housebuilding has been the most resilient category in recent months, but still declined overall during December.”

But he added that there may be more positive times ahead.

“Survey respondents cited confidence that a more predictable domestic political landscape and clarity on Brexit could deliver a much-needed boost to clients’ willingness to spend in 2020,” he said.

Housing associations have found themselves under increasing financial pressure over the past year, particularly those developing in London and the South East.

Unable to sell their private homes, which cross-subsidise their social properties, a number of larger registered providers put their development ambitions on hold. This has been added to by escalating costs around fire safety work and the improvements to existing stock.

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