Following the release of the latest UK Construction PMI, Brendan Sharkey, head of construction and real estate at MHA, believes buoyant housing demand and good management of supply chain issues mean the construction sector is holding up: “The UK construction sector, particularly the residential housing market, is coping relatively well despite the ongoing cost of living crisis. Momentum may have slowed but given the circumstances, the sector is holding up well.
“The economy may be tough for many but the pandemic was actually good for household savings, allowing people on relatively modest incomes to build up a war chest which they can now put towards a deposit. In addition, supply chain issues are no longer causing acute problems. Contractors and developers are usually able to get their hands on construction materials. Construction is a low margin business, and some contractors will be running at a loss at the moment, but the more financially stable companies are well placed to survive even if market conditions deteriorate.
“The sector isn’t crying out for government help but one issue the government needs to start considering more seriously is raising awareness of energy performance regulations among the public. In 10-15 years’ time homes that don’t meet stringent energy performance standards will be unsellable.”