Recession - continued
We’ve been asking our editorial contacts for their thoughts on where we are in terms of coming out of the recession. Here, Nick Edwards, Ian Latham, Theresa Dowling and Jason Orme add their views…
Nick Edwards
Editor, Construction News
For construction I have no doubts that next year will be tougher than this one as major contractor order books are hit, election hiatus looms and tender prices continue to be forced down. Leading indicators like the Construction Products Association quarterly forecast continue to put back recovery. Of course prospects arent consistent. Anyone heavily exposed to public sector will be forced to fiercely defend their existing relationships and seek new ones; while infrastructure feels much more certain in its spending profile over the next couple of years. On the plus side the panic of nine months ago has passed and companies seem to be planning sensibly again - including in their marketing investment.
Ian Latham
Publishing Editor, Architecture Today
Architects tend to be resourceful, flexible business people and most tell us they are weathering the storm reasonably well, with many finding clients and work in sectors they had previously neglected. Many say they have seen an increase in enquiries in recent months and they anticipate these will translate into commissions towards the end of this year and the start of 2010 - and almost all are expecting more activity next year as projects previously put on hold become viable again. Specification if course is still going on - construction activity has dipped but there’s still a lot going on, and architects are taking more care over the products and services they specify. Indeed, history suggests that some of the best buildings emerge during dips in the economic cycle - there’s nothing like a limited budget and a little more time to focus the mind on achieving both quality and value.
Theresa Dowling
FX Editor, X2 Editor and FX International Interior Design Awards
There’s definitely an upswing in confidence amongst our readers, which is positive. As plans, launches and events are being scheduled into the new year, increased activity stirs the market which has got to be a good thing. Optimism is obviously a great relief to have back, but it’s not the same as saying that we’re at the end of the recession. The time lag for designers delivering commercial or hotel projects in specialist sectors is still hard and could be delayed for some time before it bounces back to the confidence of last year.
Jason Orme
Editor, Homebuilding & Renovating
The self-build market was not affected by the recession as badly as other sectors of the housing market for two reasons: there was a dip in competition for (notoriously scarce) building plots from commercial builders, leading to more plots on the market and reduced price pressures; secondly, the decline in the construction labour market meant that, for the first time in years, self-builders could begin to negotiate down labour prices. Despite this, there was however a lowering in interest in self-build amongst the younger, build-it-for-a-profit market, who saw volatility in house prices as a reason to keep out of the market altogether. Another big problem was the stickiness in the housing market meaning potential self-builders were unable to sell their existing house to release funds to build. In uncertain times, people tended to stay put. The brave, however, enjoyed some real bargains.
There’s a real sense that the worse is definitely over with renewed confidence in prices and a more mature, long-term outlook for projects. Finance is slowly returning and the movement towards sustainable homes in coming years (which self-builders have pioneered) means there is a lot to be excited about. The pattern for individually-designed, well-built, sustainable, flexible homes is here to stay, which means the self-build market will continue to develop.
Coupled with this, the end of the housing boom has undoubtedly seen a real boost for the renovation/extension market, with people unwilling to sell up and move on at a reduced price and instead investing in their homes in the long term.
As the need for more households continues to rise, and planning policies continue to restrict land supply, investing money in quality housing will make even more sense for those in it for the medium and long term.