The publication that tracks the construction industry, Glenigan Index, has reported a 1 billion pound slump in new residential housing projects, in the second quarter.  The numbers look like this; 2.5 billion pounds of value in new residential projects pre-election compared with 1.4 billion pounds of value in new residential projects in the 2nd quarter. 

These figures, a confirmation that the housing market is losing steam and grinding to a proverbial “halt”.

Figures in the start of the year were strong for builders with a moderate upswing in home prices, but both have been struggling since May.

James Abraham, Glenigan economist, commented on the drop in private housing sector starts, saying: “This defines the fragility of the recovery.”

He added: “Start on site growth had been driven by numerous projects being reactivated amid general returning optimism from developers and better lending conditions.  However, this recovery, driven by this returning confidence, has taken a bit of a knock - obviously the general UK economic outlook is not good, and the house market could suffer in the future.”

Overall for the last year, the Index, which tracks projects valued between 250,000 pounds and 100 million pounds was down just a bit over 20 per cent.

The leaders of home builders are rejecting the idea that the sector is failing even if the numbers are strongly proving otherwise.  Pete Redfern, chief at Taylor Wimpey remarked, “ Housing market conditions are a lot more robust than people on the outside are seeing.”

The slowing of residential housing starts is contradicting the wider construction industry which surged 9 per cent in the second quarter this year compared to the first.