It was never going to be easy to return to normality in the construction sector after going through one of the sector’s busiest times in recent memory, only to have to completely stop all work due to the global pandemic.
There was concern about paying workers, ensuring projects weren’t moth balled, sourcing materials, and a number of other worries, but these all seem to have been alleviated somewhat since building restarted.
Construction in general gives a good indication about the health of the property market more broadly, as it gives a picture of the demand for new properties, new builds and how many are coming onto the market.
Before lockdown was initiated back in March, construction was in a very healthy place. The most recent government figures in the months leading up to lockdown showed that “The Construction Output Price Index (OPI) for all construction rose 1.3% in the year to March 2020, which is unchanged from February 2020. The OPI for all new work increased by 1.3% in the year to March 2020, also unchanged from February 2020.”
This shows a significant growth in house building and construction more generally, bringing in new homes for sale, new buildings intended for investment and buy-to-let and also further residential properties.
There are ever-more cases emerging that demonstrate the appetite to get the country building again, for example. with The BBC reporting about a housing scheme where nearly 300 new properties have been approved in Norfolk.
According to the article, “The proposal for 291 homes in Dereham, Norfolk were first approved in 2018. Residents expressed concerns about the width of the bridge for lorries and the position of a new link road.” However, despite this the proposals received a secondary approval.
Infrastructure Intelligence were also reporting recently that despite one of the biggest disruptions to the sector that has ever been experienced, the signs are there that we were on the road to recovery, with output slowly growing.
One big disruptor that the sector was experiencing was a drop in new orders as well as supply chain interruptions, but the newest data now seems to indicate that this is working itself out, and is starting to recover throughout the summer.
Much depends on fears that there could be a second wave of the pandemic, but so far most governments around the west and Europe have indicated that they will not seek to reimpose a national lockdown again, instead concentrating on localised controls.
All this is good news for property investors, with the market showing that despite huge disruption, the appetite for new orders and new properties is there.
Indeed, there’s little evidence to suggest that there has been a largescale drop in demand for property across this time, it has simply delayed the demand that already existed.
Rather than the industry having to find new ways of working and recovering from a standing start, it now appears that much less disruptive measures can be taken in order to get back to normality, with most industry insiders now acknowledging that things should return to normality a lot quicker than expected.