Annual Predictions
What does 2024 have in store for the industry ?
PATRICIA SOWSBERY-STEVENS , COMMERCIAL DIRECTOR , DHF
At the end of 2022 , Tamworthbased trade association , Door & Hardware Federation ( DHF ), made a series of industry predictions for the following 12 months , for example , that it would fill training gaps by expanding its training offering to include other door types ( not just fire doors ), a prediction that was realised by the launch of the Security & Emergency Doorsets ( non-fire ) and the Level 2 Award in Dock Leveller Safety Courses . It also predicted that construction output would fall as people spend less money and time renovating their homes due to them returning to work and having other commitments . This fall - by 19 % - was compounded by the rise in inflation , increased mortgage rates and energy bills . In addition , the federation predicted that the CPA Autumn Forecasts 2022 , private housing RM & I would fall by 9.0 % in 2023 ; the overall fall was slightly more at 11 %.
2023 has proved another economically challenging year for the UK and continuing turbulent economic conditions are seeing familiar companies like SafeStyle UK going into administration . “ This is becoming commonplace with household names such as this , along with over 4000 other construction companies that ceased trading in 2023 , and will impact our members negatively if they are a supplier or contractor ,” explains Patricia .
“ When we reflect on the last few years , many households have used savings accumulated during the lockdown periods to either carry out home improvements , finance spending and to sustain higher mortgage payments ,” she continues . “ As these savings are decreasing , so too is the spending in these areas of improvement as households cannot continue to sustain this level of spending , especially with many coming off low fixed mortgage rates .”
The big telling point of how the economy ( and subsequently the construction industry ) is likely to fair is by the number of new homes being built . Brick deliveries is a good indication of the current state of the industry . The figures in October 2023 were 1.5 % higher than in September and were 27.6 % lower than a year earlier . Between January and October 2023 , deliveries of bricks were 29.2 % lower than a year ago . 2023 ’ s deliveries have hit lower levels than in 2020 , which was affected by the shutdown of the housing market and construction sector in the initial national lockdown . Going forward , the concern is that 2024 is likely to see a flat , or negative , house building market ( outside of affordable housing where demand has remained strong ) following the declines this year with a pickup at the end of next year at best or , most likely , in 2025 .
Activity in the commercial sector is also expected to be affected by a slower recovery in the UK economy next year , which combined with high interest rates and two years of high construction cost inflation it is likely to add further delays to decision-making for new , large offices , universities and leisure projects .
On a more positive note , the Building Safety Regulator ’ s plan to create competent
built environments and restore trust in the construction sector will lead to an increased demand for proof of competency , third-party certification , accurate product information , and regular maintenance and servicing of products .
“ This is what DHF has been driving for many years , and since the Grenfell tragedy of 2017 , has been at the forefront of helping our industries prove competency by providing a suite of training courses , CPD webinars and Best Practice Guides ,” says Patricia . “ We have always believed that providing the right tools to afford the industry the skills , knowledge , education and behaviours required , will lead to a safer more compliant construction industry . This is now being echoed by Tier 1 contractors , who are looking to trade association members who can prove competency and we are confident our members can capitalise upon .”
“ It is very likely that there will be a General Election in 2024 and although it is rare for General Elections to significantly impact the UK economy , any potential change in government may see a change in the way government views housing and infrastructure that leads to a major investment programme , which could benefit the construction industry and subsequently , our members ,” says Patricia . “ On the negative side , a lack of parliamentary time in 2024 or delays in policy decisions and projects to be signed-off before the General Election may lead to delays and therefore , a negative impact on cashflow .”
DHF is hopeful that by the end of 2023 and into 2024 , there will be a drop in interest rates to stimulate growth . For example , the Bank of England ’ s base rate is expected to peak at 5.25 % and is then expected to fall to 4.25 % by the end of next year .
“ We remain positive for 2024 and DHF will continue to guide its members with regards to training , safety , compliance and best practice ,” concludes Patricia .
www . dhfonline . org . uk
30 JANUARY 2024 CLEARVIEW-UK . COM