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Friday 28 February 2014

The Construction Sector is Growing

If you’re in the construction business, now might be the time to sell and make a profit as this industry is booming in 2014. Why is it booming and what does it mean for buyers that would make them want to purchase your business?

The Office of National Statistics (ONS) released data this month that suggests that in the last month of 2013 the UK construction industry finally returned to growth. This growth was attributed to the increasing recovery of house building that is a result of the housing market recovery.

The ONS recorded that construction output rose by a rate of 2% in December from the month before. It fell by 4% in November. This indicates that an industry that was hit by the burst of the housing bubble pretty hard back in 2008 is experiencing growth, even if it is unsteady. Furthermore construction output in total rose 1.3% throughout 2013.

Specifically private sector house building saw a surge of 5.1% as 2013 closed. This indicated that this particular sector saw a massive jump of 21.6% from the same time a year earlier. Other areas of the sector saw growth, even if on a smaller scale.

These figures indicate that that the construction industry has finally gathered the momentum it needs to recover from the ravages of the housing bubble burst. This is because according to the ONS they indicate three consecutive quarters of growth. A phenomenon like this hasn’t been recorded in the construction industry since 2010, the height of the recession.

House building has been cited as a major reason for this revival. House building itself has been aided by government schemes such as Help to Buy, which were introduced to help first time buyers onto the property ladder. Also the holding of interest rates at 0.5% by the Bank of England is thought to have contributed to sector growth.

Howard Archer, chief UK and European economist at IHS Global Insight has commented on what these figures mean. He said that "improving house building is particularly welcome news, given that a shortage of properties is a major factor, repeatedly putting upward pressure on UK house prices." This indicates that in order to hook in new buyers, construction is only going to increase further in 2014.


At RTA Business we see this as evidence that if you are in the construction industry it really could be the right time to sell. These figures are better than they’ve been for many successive quarters and there’s also a large capability for expansion. These are two things that lure buyers into purchasing your business. 

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