UK construction output rebounds in June as homebuilder Bellway reports booming sales
Growth in the UK’s construction sector was flat across the second quarter as an increase in June reversed May’s declines
Construction output has delivered another month, thumping economist forecasts.
In June alone, output in the construction industry rose by 1.2pc compared with May. That saw the ONS update their estimate for second quarter construction growth to flat from the previous three months, up from a 0.5pc drop.
The upward revision will affect the ONS’ first estimate of second quarter GDP, which assumed that construction output would fall. But as construction makes up a small proportion (6.3pc) of GDP, the change should not affect growth estimates to one decimal place.
Total output rose by 5.3pc in June on the same month last year according to the Office for National Statistics (ONS), exceeding analyst growth estimates by 0.6 percentage points.
IHS Global Insight’s Howard Archer now sees the sector “well positioned” for expansion in the third quarter.
The rebound, coupled with healthy survey evidence, “suggest that the sector’s upturn remains firmly intact despite output being only flat overall in the second quarter” said Mr Archer.
The UK’s housing minister, Brandon Lewis, said that today’s figures show that government “efforts to get Britain building have worked”, with new housing construction output at its highest level since 2007.
British homebuilder Bellway today announced that it sold 21.2pc more homes in the year ended 31 July on the previous year.
Bellway chief executive Ted Ayres said that “the group has reacted positively to the continued strength of the UK housing market, significantly increasing output to satisfy customer demand”.
The company also saw average selling prices up by 10.2pc to £213,000 in the same period. Bellway said that house prices were up a result of “ongoing changes in product and geographic mix”.