Given the fact you now need quite a sizeable deposit it's no surprise whatsoever that Liverpool is suffering. The average wage can't be that high compared with other major cities, thus there is your problem. High property prices, thus requiring big deposits that first time buyers cannot afford. Therefore, you get a market that just isn't moving at present. London will continue to move given the higher average salary (not to mention the return of big bonuses) and the belief as reported on the BBC website today that the recession for the UK is near the end. London will benefit from the upturn first before other regions north of Watford.

In respect of Liverpool I think a few people were skeptical of the regeneration being as effective as some were suggesting in the housing market. As early as 3 years ago, I can remember builders offering discounts of 30% on offplan purchases if you bought more than one apartment in city centre.

I myself live in city centre and know of many buildings that are still half empty. Its the classic supply and demand argument and personally I think Liverpool (as great a city as it is) got carried away with the impact of Liverpool One. There is no doubt that its been beneficial, both for residents, the economy and for tourism, BUT with all of the Liverpool One jobs being in the Retail sector and I guess a large proportion of them part-time, I fail to see how they could be expected to afford £150-£175k apartments, or rents of £600-800 as they were in 2008?

I think Liverpool will have to catch up and see some of the current empty stock taken up before new developments happen in city centre but perhaps the market for house building (not apartments) should be the way forward?

I posted the following on that RBS piece:

We have seen a rise in home improvements and a lot of colleagues in the industry report the same so whilst I think it is still tough for the property industry I agree with the RBS guy that (for those lucky to be employed) a rise in disposable income has really been evident.

And with property prices still being depressed AND people in negative equity, many of people are turning to home improvements to help sell a home, improve its potential value for a later sale or just to make it refreshed if they are staying put.

I too cant see interest rates rising just yet but I'm still not too convinced that there isnt another dip ahead as reality bites from the bail outs. A finance expert on sky was saying that its all well and good borrowing £800bn but at some point it has to be repaid?

Sobering thoughts really......

According to figures released last month, the UK construction industry is currently experiencing the fastest rate of growth since Dec 2007. Driven by growth in both the residential and commercial property sectors, April was the second month of consecutive growth in construction activity.

The (PMI), construction Purchasing Managers’ Index also rose from 53.1 in March to 58.2 in April, where any figure above 50 is an indication of expansion.

Incidentally, this is the highest PMI figure since September 2007, when the credit crunch and wider recession was starting to take hold. The Chief Executive of the Chartered Institute of Purchasing & Supply David Noble, said: “It is encouraging to see the construction sector show signs of recuperation for the second month running….suggests that the whole UK economic recovery has real substance.”

Whilst, growth in construction and indeed manufacturing are usually both indicators of greater economic prosperity, the general feeling in the construction industry at least, is one of caution. Activity may well be up over a two month period but with political and wider UK and Euro zone economic instability and austerity measures coming into play, growing talk of a double dip recession, puts the recent construction figures into another perspective.

In the North West, brickwork suppliers, concrete suppliers, labourers and numerous other contractors in the construction industry sighed relief when talk of the coalition government scrapping the new £400m Royal Liverpool hospital were laid to rest and public backing was confirmed once more.

The new hospital will take about three years and nine months to construct. This will then be followed by a further three years of work during which the existing hospital and associated buildings will be emptied and demolished and the site cleared and landscaped.

According to recent press reports, the UK’s biggest two contractors (by turnover), Balfour Beatty and Carillion, are both understood to have expressed their interest in the deal to design, build, finance and operate the new facility. Liverpool and Broadgreen University Hospitals NHS Trust are due to shortlist three firms on 13th July.

In addition to improving health care in Liverpool, such a large scale project has a profound effect on the local economies. We can only hope that other such projects, planned in Liverpool and Manchester, also get the opportunity to be built.

http://www.skbrickwork.co.uk/site/uk-construction-industry-growth/