The North West was awarded more construction contracts than anywhere else in the UK (including London) in June this year – beating London for the first time in 2019.
Around 36 per cent of construction contracts for the month went to sites across the North West region, according to the latest figures from Barbour ABI’s Economic & Construction Market Review. And that made the North West the most active area in the UK in building terms – busier even than London. In fact, the Capital was second with 13.7 per cent of awarded contracts.
Manchester and Liverpool boosting North West construction
Of the North West number, £1.5bn of works was part of the Sellafield decommissioning scheme yet, even allowing for that North West construction figures have been increasing month after month.
Developments in Manchester, in particular, play a large part of this. A total of 30 sites have already started construction in Manchester with a further 28 schemes granted planning approval since January 2019. Central Manchester, Old Trafford and Salford Quays being some of the main areas for development in the city.
Plenty of building work has been ongoing in Liverpool too. The £1bn Paddington Village has recently received approval for a 17-storey hotel and 1,245 space car park, while plans are also in the pipeline for 70,000 sq ft of office space. The latter is part of the £5bn Liverpool Waters scheme, which includes a total of 105 one and two-bedroom apartments at developer Peel’s £21m Plaza 1821 tower.
Meanwhile, UK contractors received contracts totalling £5.2bn in June, with 37.2 per cent related to infrastructure, 33.1 per cent residential, and nine per cent in education.
Residential construction falling behind infrastructure
Tom Hall, Barbour ABI’s chief economist revealed that June was also the first month this year where infrastructure investment had overtaken that of residential development (residential construction having been the most active sector since the beginning of the year).
He added: “We can see a steady increase in overall contract award value for the North West from June 2018 to June 2019. London’s contract award value is less consistent and fluctuates from month to month due to seasonality.”
Tenant demand in the North West on the rise
When it comes to rental demand in the North West, figures are also on the increase. Rents in the region are expected to rise in the coming months, if the monthly 2019 RICS (Royal Institution of Chartered Surveyors) Residential Market Survey is anything to go by. And it usually is!
More than half of those letting agents surveyed in the region said that tenant demand had risen in July. However, a corresponding number of properties to rent didn’t materialise, prompting increased competition to increase rental costs for tenants.
Fewer buyers are around too. In July, the number of buyer enquiries in the North West had fallen by 14 per cent (to eight per cent) while the number of actual property sales had also fallen for the month, this time from 20 percent to 15 per cent. The uncertainty surrounding Brexit is believed to be a main driver for people holding back from purchasing property, according to many local chartered surveyors.
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