Monthly construction output is estimated to have grown by 0.4% in volume terms in November 2024.
This follows an upwardly revised decrease of 0.3% in October 2024.
This increase in monthly output came from rises in both new work (0.3%) and repair & maintenance (0.5%).
The main contributors to the monthly increase were private commercial new work and non-housing repair & maintenance, which grew by 3.1% and 1.1%, respectively.
Across the three months to November 2024, the ONS estimates that construction output increased by 0.2%. This came solely from a 0.4% increase in new work as repair & maintenance was flat (0.0%) over the period.
Scott Motley, head of programme, project and cost management at Aecom, commented: “These figures reflect the immediate aftermath of the budget, so it’s positive to see that construction activity picked back up quickly following a period of planning hiatus.
“Further challenges have since developed though. Even prior to recent changes in government borrowing costs, which will impact the Treasury’s ability to fund the commitments made in the budget, forecast demand suggests any growth in 2025 will be subdued. Construction output growth had been forecast at around 2.5% this year, but we’re anticipating downward revisions to that figure over the course of the winter.
“As we await a tempering in the financial markets, recent volatility is a fresh reminder of the need for the property industry to bridge the gap between public and private sector if we are to breed confidence in proposals and inward investment.”
Gareth Belsham, director of Bloom Building Consultancy, said: “After a few bruising months, construction has jumped into pole position as the best performing sector of the economy. Output across the industry rose by 0.4% in November, four times faster than the UK economy as a whole.
“The return to growth means construction has dragged itself into expansion territory over the past three months – it’s up by 0.2% over the quarter.
“But for all the surface sheen, the official data is far from a clean bill of health. Fortunes within the construction industry are diverging rapidly. Private sector housebuilders built 1.2% less in November than they did in October, and new home construction as a whole is stuck in reverse.
“On the other side of the coin, commercial projects are booming on the back of rising demand for office space as employers seek to get more of their staff back into offices full time.
“New commercial sector construction surged by 3.1% on the month, and on the front line we’re seeing many commercial property developers pressing the button on previously paused investment plans, as well as an increase in the number of commercial property landlords investing in repair and refurbishment to generate extra value from their existing buildings.
“The surprise fall in inflation, coupled with wider GDP growth, should support fragile business sentiment and sustain this commercial sector momentum in coming months. But the outlook for house-builders is far less rosy. High interest rates are still making it expensive for residential developers to buy land and build homes. Consumer demand is patchy too, making the contrast between residential and commercial construction acute.”
