FURTHER signs of a housebuilding revival emerged yesterday as official figures showed a leap in construction work for new homes in April.
The Office for National Statistics said year-on-year figures showed a 6.3 per cent increase in work on new homes, with output in the wider industry down 1.1 per cent year-on-year – the best result in 17 months.
The figures provide the latest evidence of recovery in the residential housebuilding sector as it benefits from UK government initiatives and improving interest from home buyers.
Closely watched data from the Markit/Cips’ construction purchasing managers’ index (PMI) recently showed the first rise in construction output for seven months in May, thanks to the fastest increase in housebuilding work for more than two years.
Housebuilders have been reporting surging interest as chancellor George Osborne’s Help to Buy package of loans and guarantees sends would-be buyers flocking to new developments.
Howard Archer, chief UK and European economist at IHS Global Insight, said the pick-up in housebuilding and the property market should start to offset a “dearth” of public sector projects amid tightened spending.
He added: “There now looks to be a very decent chance that construction output could expand in the second quarter. Even if construction output was essentially stable in the second quarter, that would help matters given that the sector was once again a significant drag on growth in the first quarter after holding back the economy appreciably over 2012.”