The latest Builders Merchant Building Index (BMBI) report reveals that the value of builders’ merchants’ sales was up by 1.4% in November 2022 compared to the same month in 2021, but only because inflation had pushed up priced by 17.3% over the previous 12 months. The amount of stuff sold was down 13.6%.
Month-on-month, sales were down both by volume and value. By value, November sales were 2.6% down on October; by volume they were down 7.2%, since prices rose 4.9% in the month.
Mike Rigby of MRA Research, which produces the report, said: “November marked a period of relative stability for the UK after months of economic and political turmoil, but it’s too early to see the impact of Rishi Sunak’s and Jeremy Hunt’s steadier hands on construction and UK growth.
“There’s been a slew of better news in the New Year. Interest rates are expected to peak sooner and lower than earlier forecasts; high energy and material costs are now not expected to be so extreme. We may be over peak Truss-shock and the autumn’s doom and gloom may have been overcooked, but there are plenty of challenges to overcome. It will take longer to repair the damage caused by the sharp rise in the cost of living, and a media focus on war with the unions will do nothing to lift the country’s well-being. Weak consumer confidence will continue to impact the housing and home improvement markets. High mortgage rates are cutting demand for new homes and major builders have cut their build programmes. Older homeowners who are mortgage free or mortgage light, the Haves, continue to spend, but the Have Nots, many homeowners under 50 with smaller savings, whose outgoings have risen faster than their incomes, have delayed or cancelled their home improvements.
“Nevertheless, this could be the beginning of a return to normality which would be welcome news for consumers, tradespeople and merchants.”