The construction industry in the UK not enough workers

The pace of construction of residential property in England and Wales rose 0.2% in the third quarter of 2014, but the growth rate slowed down. According to data provided by Knight Frank, the appetites of builders are still strong, but rising prices for construction materials and shortages of skilled labour starts to put pressure on prices.

The residential property prices in London are growing faster than the rest of the UK, but already we are seeing a slowdown in prices from 18.9% in the second quarter of 2014 to 18, 7% in the third quarter.

The slowing of house prices in London contributes to the expansion of construction sites in the suburbs of London and other cities of England.

There is a ripple effect of price growth in the towns adjacent to London, the builders who considered themselves the most attractive.

Meanwhile, the Knight Frank report noted that developers have become more selective in the choice of sites for construction.

That slowdown of construction, said the fact that the growth of land prices for residential construction in London and the inner suburbs declined slightly from 14, 2% in the second quarter of 2014, to 13.2 % in the third quarter of 2014 . A slight decrease in land prices can also be observed in the sector of real estate in Central London.

Rising prices for construction materials and the labor shortage is a very dangerous phenomenon that can lead to stagnation in the construction industry. Meanwhile, across the UK there is a significant excess of demand over supply of available residential real estate and the slowdown in construction will exert more pressure on prices.

® Maxim Savitsky. On 04.11.2014

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