Tuesday, November 2, 2010

Weakest growth in eight months

UK construction growth loses steam

David Noble, Chief Executive Officer at the Chartered Institute of Purchasing & Supply, said: "This data is particularly nerve-racking given the boost the construction sector gave to the overall GDP growth last quarter ... the high hopes of earlier in the year seem to have given way to dire predictions on what the future may hold.”

Posted by devo @ 11:42 PM (1445 views)
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23 thoughts on “Weakest growth in eight months

  • Im happy to see massive losses everywhere can only correct the big gap between the have’s and have nots !!

    As long as there is a safety net for the poor then life will go on and perhaps other hard working people can have there reward its been along time coming but lets hope it does the job !

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  • Less contruction and more immigration, that’ll do it.

    Some more black gold techie. $150.

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  • general congreve says:

    Flashman, what’s your take on this?

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  • financial planner says:

    And where the hell was this on the BBC yesterday? Nowhere. I found it on a currency commentary site. Pathetic!

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  • Hello gc. The construction sector is very weak. The end of the shared equity scheme is a serious blow because it subsidised almost half of all recent construction. The loss of growth from this sector will cut between 0.06% and 0.09% from our national quarterly GDP number. The irony is that this is probably the only sector that could usefully be subsidised (although the shared equity scheme was an appalling bad subsidy). If the government directly funded a large national building program it would provide more direct and beneficial stimulus than anything the BOE could cook up. It would provide hundreds of thousands of jobs and real money would flow around the economy. It would also provide the homes we so desperately need

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  • Flashy

    when you say “government directly funded” do you mean actual cash or say give land to people to build on instead of selling off , I know the RDAs are selling off a lot of assets including land

    I see no reason why the MOD cannot give unused land in nice sized plots for self builders

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  • the govt hasn’t invested anything in housing for donkey’s years – ever since the Right to Buy they have in fact been dis-investing. The last govt was keen on high house prices because new housing is usually subsidised by the private sector through section 106 agreements. The only net housing subsidy is housing benefit which goes to public and private sector landlords.

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  • general congreve says:

    The thing with housebuilding is that this country is already crammed to the brim with infrastructure. I really don’t like the idea of building over any more of it. I also don’t think it is necessary in purely population terms. I don’t see people living on the streets and I know of no one who hasn’t got somewhere to live, it’s just that some of them are renting and would probably rather buy. It’s really a question of prices and ownership than the need to build more houses, I believe.

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  • mark: I mean the government taking direct control of the building project. They could sell themselves the land (eerily similar to QE) and put out tenders for construction companies to run the scheme. The funding for construction would come directly from the government. The important part would be that the govt/people are the owners of the scheme and the construction companies would just get a fixed percentage for managing the scheme. This would be the kind of stimulus that I could support because taxpayers money would only benefit the taxpayers. There is no reason why the scheme couldn’t turn a healthy profit as well as creating hundreds of thousands of jobs. It would surely be a better stimulus plan that the BOEs useless paper shuffling

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  • GC

    the big issue in the Uk as I see it is the housing stock is of poor quality too small and overpriced, any modern house you view is terrible not much bigger than a rabbit hutch and looks like steptoe and son built it, the snags are frequent and the build quality is very very poor.

    I have a friend who owns a modern “mews” house he cannot open the bedroom doors after he placed standard size double beds in the bedrooms, what idiot designed his house? What planning idiots allowed the build to go ahead with such a large flaw. The 2 bedrooms are too small, no dining room, very very small kitchen a lounge you can just about fit a sofa in and a bathroom you cannot turnaround in easily or stretch your arms out when drying with towel…………. he paid around 160k for it.

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  • GC @6: Our housing quality and size is the worst in Europe. Families are living in cramped poor quality accommodation, which reduces their quality of life. Supply is definitely constricted which puts house buying out of reach for millions of people. This has helped BTL landlords to suck dry the pay packets of lower income families, who will never have anything to show for their monthly expenditure. A large building program would help or cure most of these issues.

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  • sibley's b'stard child says:

    I’m with GC – albeit from a purely sustainable viewpoint. I’m sure this will fly in the face of some J-Curve, Elliot-Wave or somesuch theory but our problem should be reducing overall population (not necessarily the ‘easy-win’ of reducing immigration but disincentivising population growth, although, that worked a treat for the Chinese…); not just buliding more.

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  • sibley I think you will find that the f and gh.1.13 curves proves you wrong. Just kidding.

    The problem with ‘disincentivising’ population growth is that the demographics become dangerously top heavy. The aging of the population is a serious problem in the west, where there is always the worry that there will not be enough young workers to support the armies of retired workers who are now stubbornly living for decades past their retirement

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  • what does the UK offer, apart from some wonderful scenery

    Great benefits system (supporting those who don’t want to work)
    Small houses
    Poor infrastructure
    High Taxes
    Poor Weather
    A great legal system that rewards the criminals and penalises honest people
    Bizarre planning laws
    Councils that work with supermarkets to destroy high streets
    Corruption in local government and the police force
    Litter on streets
    People who enjoy getting into debt like it is a national pastime
    Obsession with bling and fame

    anyone want to add to list

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  • fat women and road rage?

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  • sibley's b'stard child says:

    Ha ha, very good Flash.

    To be honest, I have no idea what the solution is but exponential, well, anything is unsustainable. Apparently humans taste like pork; hence the Polynesian term ‘longpig’…

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  • Vanessa Feltz

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  • what always amazes me is when you fly over britain and see empty fields for miles and miles

    how much of our farmland is left empty to entertain europe?

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  • @ flashman / GC
    I too cannot understand why the government has not announced plans to stimulate our construction industry. It seems too obviousat …… a nationwide scheme to build all the affordable housing we need will boost the flagging economy / construction sector / retailer / taxation receipts and allow the lost generation the chance to own their own home.
    Win – win situation surely (‘cept for the btl brigade) ………… but sadly a vote loser

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  • sibley's b'stard child says:

    @ 18

    Still; you would.

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  • It’s pretty predictable that construction would fall – it indicates what’s happening in housing i.e. house prices are falling.

    No one is going to build, if the market isn’t out there – especially for tiny city center flats. There is certainly plenty of land, it’s just that it’s use is very heavily constrained.

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  • general congreve says:

    @8 and @9 – Good point, modern houses are too cramped and poorly built. I’ve nothing against cramming a few less houses on developments to improve space in new houses. It just seems to me that on average we have enough housing, it’s just priced out of the reach of most to buy, so they have to rent instead.

    @13 – Fat women. Too true. One thing food price inflation is definitely good for 😉

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