Election could put brakes on housebuilding

The general election is casting a shadow over prospects for growth in the construction industry.

A 5.5% growth in construction output this year will be driven by private housing, commercial property and infrastructure work, according to the Construction Products Association.

But private house building is likely to be vulnerable to uncertainty regarding government policy such as Help to Buy. CPA economics director Noble Francis forecasts that a 10% rise in housebuilding this year will shrink to a 3% increase in 2017.

The CPA also says construction output in all sectors is likely to slow in 2016 and 2017.

“The lag between construction contracts and work on the ground means that activity in 2015 probably won’t be impacted, since the majority of work for the year has already been planned.  Instead, we expect a break in private and public investment this year for future projects,” Francis said.

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