While many are clock watching as we hurtle once again towards festive fun and celebrations, with discussion rife about whether we will see a white Christmas, for the glazing sector it’s also a time of focus and forecasts.
According to recent reports and the most recent Experian forecasts, it is predicted that construction output will grow by 3.6% next year and then a further 4.3% increase should occur in 2017. So it looks to be boding well.
Earlier this year total output for work in the sector was calculated to reach £142 billion by 2017, a rise from£131 billion this year.
The growth forecast for 2015 has however been reduced from 3.9% to 3.5% which has been attributed to reservations relating to the general election earlier this year, and which Experian put down to a “less buoyant first half of the year than expected”.
Looking at construction in general, it is considered probable that private commercial construction will be the fastest growing area in 2016 with a 7% growth; however the speedy 25% growth of infrastructure shown this year is predicted to fall by 5% in 2016.
For the Glass and Glazing sector there would seem to be a positive outlook as private housing output is predicted to grow by 5% during 2016, although falls of 10% have been suggested for the public housing sector during the year.
With a generally positive forecast this will no doubt reflect on our national fascination regarding house prices, which are a main stimulant in relation to the consumer economy within the UK. Constantly we try to second guess the movement of the property market, with detailed analyses from one lender, broker or sales agent or another, being put in front of us to scrutinize faster than we can blink.
It would seem once again that the London area is forging ahead according to many mortgage companies and estate agents, with the suggestion that the annual increase in house prices in the Capital will grow by 10.6%.
According to Nationwide, the view is a little muddier as the regions beyond London and the South East slowed in the third quarter, with the Midlands and northern areas performing much slower.
It would seem that the Land Registry would be in agreement with this as figures demonstrate that property market growth has continued to cool with house prices up 4.2 % compared to 12 months ago. However the East of England continues to see the biggest annual growth, with prices up 8.4 per cent compared to 2014.
Rightmove has suggested that an average property in London could reach £1 million by 2020 if costs continue to escalate at the current rate.
Yet how realistic are these figures? As the Land Registry uses a repeat sales formula the monthly index does not include properties that have not sold at least twice since 1995. Equally, sales figures are not included relating to new build homes or those that have been in long-term ownership. Due to a lack of properties on the market, currently, vendors are seizing this opportunity to hike prices up, with average asking prices currently having risen to the biggest on record since September 2002.
Another area that will undoubtedly have an effect on the glazing sector will be energy efficiency and the reduction of carbon footprints, once again, becoming a major topic for debate.
Energy and Climate Change Secretary Amber Rudd has stated that she intends to prioritise fuel costs with a view to keeping bills down for consumers and businesses alike. Her commitment to reducing emissions has been declared that it will be ‘in the most cost-effective way’
She continues on to state:
“Our support has driven down the cost of renewable energy significantly. As costs continue to fall it becomes easier for parts of the renewables industry to survive without subsidies. We’re taking action to protect consumers, whilst protecting existing investment”.
The solar industry has suggested a feasible rescue bid for British solar with the recommended £1 solar rescue plan for 2019 being put forward as an alternative to the Government’s proposed cuts to the Feed-in Tariff for the technology.
It is hoped by the Solar Trade Association that this will salvage the solar industry to provide a viable solution for the solar market and enable it to continue developing. It certainly will become an increasingly important topic for debate over the coming years.
Finally as we head towards the beginning another Christmas and New Year, it has been interesting and inspiring to see the changes, developments and growth across the glass sector. The culmination of a good business year has been celebrated by the great and the good of the industry and the richly deserved crowning glories of Accolades and Awards, via the G Awards and the National Fenestration Awards. Many congratulations to everyone involved.
As the business year comes to a close, the entire MyTradeTV team would like to celebrate the spirit of the season by wishing wish you a very Happy Christmas and much continued success for 2016.
Article written by Helen Duval