I took a quick glimpse at the Average Weekly Earnings figures out today to see if there was an obvious sign of downward pressure on those employed in construction.
Well comparing the average weekly earnings over the three months to this April with the same period a year ago we get a rise of 1.7%.
Continue reading "Average weekly earnings go up in construction" »
The latest forecast from the Council of Mortgage Lenders paints a more positive outlook for the housing market than it did when it last forecast in December.
It now thinks repossessions this year will hit 65,000, 10,000 fewer than previously thought, with fewer mortgages falling into arrears and net lending shrinking by just £5 billion as compared with £25 billion.
On the basis that if a gloomy forecast comes true it is probably because the policy makers were either not listening or they screwed up, it suggests that the economic medicine being administered is at least easing some of the pain in the housing market.
Continue reading "Housing market medicine working, says CML" »
The latest figures divined from the property website Rightmove show that asking prices fell 0.4% in the month. And at first sight this seem a little at odds with most of the data coming from the housing market of late.
There is data to suggest that there are growing expectations of house price rises among the public and that there is a dearth of homes coming onto the market. Potential sellers it would seem are holding on until better times.
Against this background it would not be unreasonable to expect asking prices to rise, with sellers testing the water at a price closer to the one they covet. But no, it would seem.
We do not have a normal market.
Here are a few thoughts on one aspect of the market that may be worth more examination.
Continue reading "Rightmove figures provide food for thought on house prices" »
What are journalists looking to provide when it comes to a news story.
Well "TRUTH"
The story should be Topical, Relevent, Unusual, with a bit of Tension or conflict and, very importantly, it should have Human interest.
Now let's think about it...
...Unusual eh? ...mmm.
So if the story you read is going to be unusual that means...well it means the more good news you read the less usual good news is.
So...that means bad news is the norm.
Now that is depressing.
It is not just because I have family in Norwich and support Norwich City that I took a particular interest in the "innovative" deal recently struck between the city council and the Homes and Communities Agency.
Nor was it because I have a great deal of respect for the knowledge and efforts of both Richard Jones of EC Harris and Terry Fuller, now of the HCA. In a world where hot air blows freely, here are two people well worth listening to.
No. What intrigues me about this deal is how it might reshape the way housing is delivered.
Continue reading "Why the "innovative" HCA Norwich City deal could prove very significant indeed" »
The official employment figures released today show that the construction industry has lost just 40,000 jobs.
That clearly is rubbish.
Were the figures accurate and were the construction output figures accurate it would suggest that as the industry has plunged into recession overall labour productivity for the construction sector has fallen by about 16%.
OK there may be a bit of a lag effect, but ultimately the output is in large part down to the people doing it, so I'd be surprised if the lag is much in such a robust industry as construction.
Indeed, historic data suggests that construction jobs go in anticipation of a downturn (see Graph 1).
So, unless I can be advised differently or unless I have missed something obvious, I can draw no other conclusion than these particular figures are not worth the paper they are written on.
Indeed they may prove worse than useless.
Graph 1
Continue reading "Duff jobs figures pose a threat to construction industry" »
It's coming around to the construction forecasting season again and the industry prognosticators will be gathering to discuss the ups and downs of the industry.
If I were you, I'd be bracing myself for some pretty savage revisions to what already look like pretty savage forecasts.
Peak to trough in the 90's recession we saw a drop in volume terms of 14% in workload. In the 1980s recession it was 16% and in the 1970s it was 20%, according to the 2005 constant price output data.
Who knows how deep this recession will be for construction, but I wouldn't rule out the possibility that this recession could eclipse all of those. Don't be shocked if you see a forecast suggesting a 25% drop.
What has made me that pessimistic?
Continue reading "5 reasons why we might be facing the mother of all construction recessions" »
The uber-bearish traders in house price futures appear to have softened their view on the depth of the slump in house prices quite markedly over the past month or so.
At the turn of the year you could have bought a notional average house three years hence on the futures market for less than £110,000. That is against the peak price, as measured on the Halifax monthly non-seasonally adjusted index, of £201,081.
The May three year house price rose to £144,000 against £130,000 in April.
That puts the peak to trough cash fall at 28% against the near 45% fall priced in at the turn of the year.
For house builders looking to hedge against a future house price slump, the futures market may start to look attractive again if this trend continues.
The good news is that after the monstrous distraction over the past month cause by raking over expense claims made by MPs we are getting back to debate about things that really will shape our lives - notably how much dosh there is (or rather isn't) in the Treasury coffers and how much the Government might have to spend,
The bad news is that even from the scantest of glances at the Treasury figures as we see on the TV makes you realise something gruesome is afoot.
But as if that isn't bad enough, when we look at the prospect facing the construction industry we have figures coming out all over the place that on the surface tease us into seeing signs of comfort.
That is until you look in detail and try to put meaning to the numbers. Then you realise these are barbed data.
The latest housing market report from the surveyors' body RICS will provide further cheer for most of those selling homes.
The June 2009 report suggests that the pace of collapse in prices continues to ease, the volume of sales has nudged up and there appear to be more buyers. And there is an ever decreasing amount of homes competing for the rising number of buyers.
This survey does seem to fit with the trend of earlier RICS surveys and a growing number of other indicators that are being read by some pundits as pointing to a bottoming out in the market.
Calling the bottom of the market now would be a brave call, given the huge number of threats not just to the macro economy, but also to the housing market more specifically.
Indeed, for me the really interesting story in this survey is that we may be seeing a re-emergence of a north-south gap in the performances of the market in England and Wales.
Continue reading "North-South divide develops in housing market - is it a cause for concern?" »
Brian Green
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