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21/04/2016

Brexit and planning delays slow down construction activity

Words: Huw Morris

Uncertainty caused by the EU referendum and planning delays are contributing to a slowdown in confidence and workloads across the construction industry in the past three months.

A poll by the Royal Institution of Chartered Surveyors (RICS) reveals that the level of construction work in the private housing sector is rising at the slowest pace since 2013.

The latest RICS construction market survey says 36 per cent more respondents reported a rise, rather than a fall, in the private housing sector, compared to 50 per cent in the first quarter of 2015.

A total of 58 per cent of respondents also reported problems with planning delays.

RICS warns that growth is waning despite major government commitments to new infrastructure and housing programmes. Chief economist Simon Robinson commented: “One might well ask why growth in private housing workloads is softening at a time when policy is firmly focussed on the creation of new starter homes. We have long held the view that starter homes cannot be the only solution. There is an issue around the availability of land on which new houses can be built, and we would like to see more being done to free up privater brownfield sites.

“Our survey tells us that planning delays are one of the biggest barriers to growth in the construction sector. We have recommended that councils work together to create a team of emergency planners who can parachute into boroughs that are experiencing significant delays, therefore reducing a major growth barrier.

“That said, we cannot discount the climate of uncertainty caused by the forthcoming EU referendum. We know that a range of sectors have been affected by these issues as investors look to delay any decisions until a final outcome has been determined, and construction is no exception.”

Image credit | iStock

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