Cautious optimism continues in the construction market according to the latest research by RLB.
The construction and property management consultant has published its quarterly Construction Market Intelligence report which sets its tender price forecast in the South East to 3.25 per cent.
The report says the region is experiencing a gradual recovery, with 2.8 per cent growth largely driven by Government initiatives to address the housing shortage and a notable increase in commercial leasing in Greater London and the South East.
It states investment confidence has been affected by world economic events but markets appear to be moving back towards the highs of the turn of the year, spurred by growth areas like data centres, which is prompting cautious optimism in the sector ahead of the June 11 Spending Review.
Across sectors the picture is mixed. There is low unemployment and ongoing shortages of both skilled and unskilled labour.
While public-private partnerships (PPPs) are seen by many as the financial injection needed for momentum, RLB warns PPP solutions can be time-consuming.
Input costs, according to the Building Costs Information Service (BCIS) are forecast to rise 4.15 per cent in 2025, squeezing cost margins.
Michael Righton, managing partner for RLB South East (pictured), said: “Looking ahead, the South East’s construction industry is poised for moderate growth, supported by Government investment and a rebound in the housing and commercial sectors.
“However, the pace of recovery will depend on addressing labour shortages, managing costs and ensuring delivery of major infrastructure projects.”
The report can be seen here.
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