Tender prices stop falling

Grant Prior 13 years ago

Contractors are expecting tender prices to remain static over the next six months as the market sees an end to the huge falls of  last year.

Tender prices fell once more in Q2 2010 according to the latest UK Construction Tender Price Index compiled by BCIS, the Building Cost Information Service of RICS.

But the fall in tender prices has been slowing dramatically over the last year from an annual fall of 13% in Q2 2009 to 4% in Q2 2010, with only a 0.5% quarterly fall inQ2 2010.

A recent BCIS survey of contractors also showed the majority are expecting tender prices to remain static over the next six months.

The upward push of the continued increase in resource costs is competing with the downward pull of uncertain future demand.

Material prices rose by 3.8% in Q2 2010 which is a 6.5% increase on 2009.

National statistics show significant increases in certain material costs, including concrete reinforcing bars,ceramic tiles and fabricated steel work. Sharp increases in annual materials prices are expected through to Q2 2011.

Average earnings within the construction industry remained unchanged in Q2 and nationally agreed wage rates are expected to rise just behind the rate of inflation until Q3 2011.

Peter Rumble, Information Services Manager at BCIS said: “Although new work output is expected to grow strongly in 2010, it is anticipated that tender prices will remain unchanged over the second half of this year, with new work output growth in 2011 slowing to a little above a position of no change.

“Quite strong input cost rises coming through in Q2 2010, feeding through into tender prices in the remainder of the year, are also likely to prevent tender prices from falling further in 2010.

“Consequently, tender prices are only expected to rise modestly in the year to Q3 2010. Over the second year of the forecast, withsubdued new work output growth in 2012, tender prices are likely to rise more or less in line with input costs.”

Latest news

Equans suffers £146m loss and quits new build housing

Losses hit £99m on housing association new build work
3 hours ago

Job cuts at modular house builder TopHat

Offsite housing specialist acts in response to "challenging market"
4 hours ago

Graham wins £85m Milton Keynes Lakes Estate revamp

Enabling works start ahead of building 200 council homes
3 hours ago

Go-ahead for London’s largest estate £1bn rebuild

Spring start for first job at Stratford's Carpenter Estate scheme
17 hours ago

Costain trials electric vans on major civils sites

Green vans meet "tight budgetary requirements" in pilot scheme
20 hours ago

Green light for major mixed-use scheme in Ealing

Scheme will provide 10,915 sq ft of industrial workspace alongside 140 new homes
3 hours ago

Taylor Wimpey sees tender inflation fall to 1%

House builder retenders site work as build costs slide
1 day ago

Careys back in profit after £47m turnaround

Contracting division back in profit ahead of three-year growth plan
2 days ago

Rye Demolition goes into administration

Another specialist contractor goes under
1 day ago

Historic breakthrough for HS2’s longest tunnel drive

TBM Florence ends her 10 mile journey under the Chilterns
2 days ago

Volumetric builder Tide seals deal to start London tower

32-storey North Acton tower will consist of 462 co-living units
1 day ago

Costain moves HQ to London’s Can of Ham

Contractor makes return to London from Maidenhead base
2 days ago

Former Keltbray highways MD joins McAlpine

Vip Gandhi takes lead role at Transport division
2 days ago

Willmott Dixon exits stage left from Essex theatre contract

Contract re-tendering shines spotlight on growing schism between contractors and clients
2 days ago

Purpose build student schemes to surge again

Unite assembles record £1.3bn pipeline as fall in HMO supply boosts PBSA sector
2 days ago

Bidding starts for £1.4bn Midlands Rail Hub Alliance

Alliance will deliver upgrades to rail lines and stations around Birmingham and nearby towns
2 days ago

Brickability sounds warning over materials demand

Distributor sees lower sales lasting for longer before house building recovers
2 days ago

English Cities Fund raises extra £200m for work pipeline

Muse, Homes England, L&G partnership to double in size
2 days ago

Go-ahead for 64 homes at former Glasgow Coliseum theatre

Robertson-owned developer Urban Union to build four housing blocks at site
2 days ago

Competition probe launched into 8 major house builders

Cartel watchdog says volume house builders may have exchanged competitively sensitive information
3 days ago

Cement-free concrete firm falls into administration

DB Group also owned Pudlo waterproofing products
3 days ago

Everton Stadium now structurally complete

Laing O'Rourke lifts final concrete terrace section into place
3 days ago

HS2 launches third London Northolt tunnel TBM

1,700 tonne machine begins 3.4mile dig under the capital
3 days ago

Willmott Dixon set for Manchester science park job

Contractor understood to be in final stages of talks to land £75m Greenheys building
6 days ago

Transport jobs get £4.7bn of cancelled HS2 cash

Government details funding for North and Midlands from 2025
3 days ago

Stewart Milne went down owing supply chain £153m

So far 1,375 firms have come forward with unpaid bills
7 days ago

Didcot disaster investigation enters its ninth year

Still no answers for families of quartet killed in demolition collapse
6 days ago

Mount Anvil wins £275m Westminster estate renewal

First phase of Church Street area regeneration will deliver 400 new homes and a library
7 days ago

Trio of A47 road upgrades to go-ahead as legal challenge fails

20-month delay adds tens of millions to dualling costs
6 days ago

Skanska and Morgan Sindall win £277m duo of Cambridge jobs

Railpen awards £200m Botanic Place and £77m Devonshire Gardens office jobs
1 week ago

Contractor services