The market has experienced a surge in activity since the weather-affected Q1, with the potential for continued higher demand into 2014. As the most recent Construction Trade Survey confirms, the biggest boost has been in the new build housing market, stimulated by the government’s ‘Help to Buy’ scheme and the positive economic outlook for the broader economy.
The success of the government’s policies has caught many within the construction industry off-guard. House builders are increasing starts by nearly 30% over the previous year, and this sudden shift in demand temporarily caused bottlenecks in supplies of some materials such as bricks and blocks.
The operative word here is “temporarily”.
Research by the Association shows that the Q2 upsurge in demand, coupled with haulage constraints, created short-term supply problems for one product in particular (aircrete blocks), and led to longer lead-times for other products such as bricks, concrete and roof tiles.
More recently, however, materials production has increased, stocks have fallen and imports have risen. For example, brick production in September was 14% higher than a year ago and stocks were 34% lower. Q2 imports were 34% higher. In addition, some brick manufacturers are bringing idled plants back on line to deal with greater medium term demand.
Given these results, we are concerned when we hear talk of supposed building material shortages still being raised as one of the “impediments” to an increase in house building. The building products manufacturers are fully capable of handling market demands. Similarly, should anyone still complain that they still cannot obtain materials, our builders merchants would be more than happy to talk with them about supplies.