Future investment in housing to rebuild industry performance
London, United Kingdom (PRWEB) April 02, 2013
Buying the family home is the largest lifetime investment for most Britons and can deliver households with both financial and emotional security. Trends in housing investment have huge implications for the economy and fiscal and monetary policy.
The Residential Building Construction industry accounts for the bulk of work done on new housing construction, repairs and improvements. It also generates revenue from the aligned non-residential building market (notably from work on mixed-use commercial and apartment developments). The industry currently generates revenue of £47 billion, a decrease of 5.0% on the previous year and representing an estimated decline by an annualised 5.2% over the five years through 2012-13.
According to IBISWorld industry analyst Anthony Kelly, “successive recessions in the general economy and tight lending conditions have driven down demand, though an injection of government stimulus fuelled a short-lived upswing in housing investment during 2010-11”. The value of new housing construction is estimated to fall by an annualised 6.5% over the five years through 2012-13, with work on repairs and maintenance to existing dwellings down 0.8% annualised, and housing starts falling by an annualised 10.9% to 123,000 units.
The industry directly employs about 200,000 people in 23,500 contracting businesses. However, there is a heavy reliance on a less-permanent workforce that numbers over half a million people, including subcontracted labour (e.g. electricians and roofing contractors) and professionals (e.g. architects and surveyors). The bulk of industry activity is undertaken by small-scale firms operating in narrow regional markets.
The industry is forecast to endure more contractions over the short term, with revenue declining to a cyclical trough in 2013-14, reflecting the impact of weak economic growth and the financial crisis. Kelly adds, “the eventual upswing of housing investment from 2014-15 will support revenue growth over the five years through 2017-18, exceeding the forecast growth in GDP (2.0%)”.
The Residential Building Construction industry has a low level of market share concentration with the four largest homebuilders together accounting for less than 20% of total housing completions and industry revenue. Major companies include Barratt Developments, Taylor Wimpey, Persimmon Homes, Berkeley Group, Bellway and Galliford Try.
For more information on the Residential Building Construction industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.
IBISWorld industry Report Key Topics
This industry includes contractors undertaking new work, remodelling, renovations and repairs of residential buildings including single-family houses, multi-family buildings (high-rises), and housing association and local authority housing. Work can be carried out on a firm's own account or on a fee or contract basis, and portions of the work or even the whole practical work can be subcontracted out.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalisation & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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