Surveyors see first signs of recovery

Aaron Morby 14 years ago

The building industry has started to show the first signs of a recovery in activity.

According to the latest survey by the Royal Institution of Chartered Surveyors a slim majority of member firms reported a rise in work activity in the first three months of the year.

This is the first time the survey has seen a positive balance since the start of 2008.

Five per cent more chartered surveyors reported rising rather than falling workloads, compared with a net balance of 12% reporting falls in the last quarter of 2009.

But the overall improvement masks considerable  variation across each work sector, with some surveyors reporting concerns over a lack of finance for development.

The private commercial workloads net balance increased from -11 to +17. Likewise  both private housing and public housing workloads moved back into positive territory, albeit only very modestly.

But private industrial and infrastructure activity remains depressed with surveyors reported falling workloads at -9 and -4 respectively.

There was also significant variation in performance at a regional level with the south east once again leading the upturn.

Surveyors in London and the south east reported a sharp turnaround in workloads, with the net balance swinging from -15 to +21.

A slightly less dramatic shift in sentiment took place in the midlands and east anglia, where the net balance jumped from -9 to +10 but in the north and Scotland, the net balances remained in negative territory at -7 and -6 respectively.

In Northern Ireland, surveyors reported continued sharp falls in workloads, with the net balance deteriorating from -37 to -59.

Looking forward over the next 12 months, expectations for workloads are stable with the net balance increasing from 2% to 4%.

However, expectations for employment and profits are fairly downbeat with surveyors expecting both further job losses and a contraction in margins.

Simon Rubinsohn, RICS chief economist said: “The construction sector seems to be finally lifting its head above the recession parapet but the continuing lack of development finance remains a major obstacle to a sustainable recovery with surveyors still pessimistic about future prospects.

“Concerns over likely cuts in public sector capital spending programmes is another factor contributing towards the cautious stance of respondents to the survey.”

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