Responding to the UK Construction PMI data released in early December, Brendan Sharkey, head of construction and real estate at MHA, believes that confidence and activity is currently steady but 2023 is set to be a bleak year.
Sharkey added: “Despite declining sector optimism regarding the UK’s economic outlook, the construction sector continues to cope well. Firms have a steady pipeline of work going into 2023 because many projects were pushed backed this year. For many, last month’s Autumn Statement occasioned a big sigh of relief as there were no reductions to existing infrastructure spending. However, whilst the short-term outlook is reasonable, the further one peers ahead the grimmer it looks. No one feels very confident about the back end of 2023.
“For the housing market, demand is tailing off amidst the cost-of-living crisis and the imminent recession. The ending of the Help to Buy equity loan scheme in March 2023 will mean many will struggle to enter the property market in the short term.
“2023 will see a very significant change within the rental property market due to the forthcoming series of Energy Performance Certificate (EPC) rating deadlines, which begin April. The costs of meeting the EPC requirements means many are reluctant to upgrade homes to meet the minimum required rating of E by April 2023, C by April 2025 for new tenants and C for all homes by April 2028.”