Glenigan gives positive mid-year forecastGlenigan gives positive mid-year forecast

Glenigan
Positive forecasts for rest of 2017 and 2018 — Glenigan.

A 1% rise in the total value of underlying new project starts for the rest of 2017 is predicted in Glenigan’s latest mid-year forecast, followed by a further 2% in 2018. Glenigan comments, ‘Political uncertainty and doubts over the Brexit negotiations will inevitably take their toll on the industry’s prospects for the coming two years. But while slower economic growth is likely to impact on new project starts, particularly in the private sector, the good news is that overall activity across the industry is set to continue expanding.’

The public sector presents a mixed picture. Capital spending is on the rise following the referendum, and further rises in public spending are likely in the wake of the General Election result.

In the short term, any extra spending is likely to be focused more on areas of political tension, such as the NHS frontline and social-housing safety measures following Grenfell rather than longer-term capital projects

Glenigan expects the value of new-work project starts in the health sector to rise by 23% this year and that although education starts are under pressure this year they are set to rebound sharply in 2018.

One branch of the private-housing sector which is gaining momentum is build to let. Last year, project starts in this sector were worth £750 million, involving more than 5500 units — treble the level of 2015 and with further growth expected this year.

To date, the volume housebuilders remain positive. Last month Persimmon said its sales in May and June were healthy and the market had taken the snap election in its stride, its first-half completions were up 8% on the period last year at 7794.

Meanwhile, Glenigan forecasts show that the supply of slots available for development has improved significantly in the past three years, notably in London and the south of England.

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