Overall construction starts rise, but development slips
The January 2025 edition of Glenigan’s Construction Review has found that main contract awards dipped by -4% in 2024, reflecting a difficult year for housing development.
Similarly, detailed planning approvals fell by -19% over the year, with major projects hit hardest at -34%.
Overall, work starting on site averaged £10.4m per month in 2024, an increase of 20% from 2023, driven by major projects (£100m or more) across the hotel and leisure, education, civils and infrastructure sectors.
Meanwhile, the latest Red Flag Alert report from Begbies Traynor has revealed that the number of UK businesses in critical financial distress rose by 50.2% quarter on quarter in Q4 last year.
The report also highlighted that construction is the sector with the most firms deemed to be in either critical or significant financial distress, with 7,000 firms in critical financial distress – an increase of 58% in the quarter.
The number of construction firms facing significant financial distress was more than 97,000.
Julie Palmer, partner at Begbies Traynor, said: “The situation feels very precarious. Sadly, this has only been exacerbated by the tax rises and increase in national minimum wage levied on businesses during the October Budget which means the financial strain on businesses will only increase later this year.
“Even at this very early stage, the outlook for the rest of 2025 is uncertain, at best.”
Promising start to 2025 – Rightmove
The Rightmove house price index for January has found that the average property price has risen by 1.7% in the month to £366,189 – the largest jump at the start of the year since 2020.
The report also found that a record number of new sellers have come to the market since Boxing Day, with the number of new properties coming to market is 11% ahead of the same period last year.
However, the mortgage firm did highlight “uncertainties ahead”, citing the pace and number of interest rate drops, and the impact of the stamp duty deadline on 31 March.
TopHat reveals loss as brickmaker warns of price rises
Modular housebuilder TopHat has revealed that losses from its factory operations more than doubled in its penultimate year of trading, with a £46m loss.
Meanwhile, building products firm Marshalls has warned of a turnover fall of -8% in 2024, and Forterra has warned of price rises in the wake of National Insurance tax rises announced by the Government last autumn.
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