A Brighter Outlook for UK Housing

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As I sit down to write about the state of the UK housing market, I’m met with a mix of uncertainty and hope. The construction industry is facing near-term challenges, but experts are forecasting a brighter outlook in the not-so-distant future.

Image: UK housing market

According to Glenigan’s UK Construction Industry Forecast 2024-2026, the sector will encounter obstacles such as slow economic growth and persistently high interest rates. However, with a new government in place, political uncertainty is dwindling, and markets are rallying.

“There are signs of growth, signalling a gradual recovery,” says Allan Wilen, economic director at Glenigan. “In the private housing sector, we anticipate starts will pick up in the latter half of this year, driven by improved affordability and brighter economic prospects.”

This optimism is backed up by predictions of a modest 3% increase in project starts this year, with 7% growth expected in 2025 and 6% in 2026. It’s a welcome shift after a tumultuous period for the industry.

As someone who’s been following the UK housing market for years, I’ve seen firsthand the impact of political uncertainty on construction projects. It’s no secret that delayed decisions can have a ripple effect throughout the industry, from architects to construction workers.

However, with the new government’s substantial majority, we can expect policy decisions to be made at a faster pace, boosting performance and signalling a recovery in the near future.

Image: Construction site

Of course, there are still challenges ahead. High interest rates will continue to impact the industry, and economic growth remains slow. But with experts forecasting a brighter outlook, it’s hard not to feel a sense of optimism.

As I look to the future, I’m reminded of a conversation I had with a contractor friend a few months ago. He was bemoaning the state of the industry, citing delayed projects and uncertainty. But even then, he expressed hope for the future, citing the government’s commitment to investing in infrastructure and construction.

It’s this sense of resilience that will carry the UK housing market through the tough times and into a brighter future.

Image: Housing market recovery