Booming housebuilding pushes surprise fourth quarter construction increase
In December of last year, output in the UK construction industry increased two per cent from November, and 6.3 per cent from a year earlier.
The high-note end to the year was driven almost entirely by the surging housing market.
When seasonally adjusted, the increase was 0.2 per cent over the quarter, flying in the face of estimates of a 0.3 per cent drop, released in initial GDP figures.
Rob Wood of Berenberg says that, with confidence in the recovery building, interest rates still low and house prices up, 2014 should be another good year for builders. Even if the bad weather we've had means construction takes a hit, firms won't waste a moment in making up for lost time, he adds.
Housing was up 10.4 per cent last year, compared to a 0.9 per cent rise in other new work. That puts housebuilding up 47 per cent from its January 2010 low – and well above other kinds of construction.
Over 2013 as a whole, industry output grew by 1.3 per cent – that’s faster than last year, when it fell by 7.9 per cent, but slower than the 2.3 per cent and 8.3 per cent growth seen in 2011 and 2010 respectively.
The numbers from the Office for National Statistics shows that construction only accounts for 6.3 per cent of GDP, and that the upward revision for the quarter has no effect on the preliminary estimate of growth to one decimal place.