Tender Price Indicator
As UK economic growth slows, the construction industry remains resilient albeit at reduced levels of growth.
Faced with lack of clarity on Brexit and upward pressure on pricing, forecast demand for construction continues but at a slower rate than 2107. Against this back-drop we have left our UK average tender price forecast for the next three years unchanged from our last review.
London remains flat at 1% for 2018 and 0.50% for 2019, with reductions to 1.0% and 1.5% for 2020 and 2021. Against our regional forecasts the majority of UK regions remain unchanged, but the North, Scotland and Yorkshire are all down. The North West bucks the trend with forecast increases to 2.5% in 2018 and 2.0% in 2019.
Into 2022 we forecast a return to a normal growth market and have adopted our long-term average tender inflation rate. However our forward order survey is illustrating a reduction in demand and limited orders compared to our last quarter survey.
Our forecasts take account of all sectors and all project sizes as a statistical average indicating an overall trend in pricing levels. It should be remembered that individual projects may experience tender pricing above or below the average rate, reflecting the project specific components and conditions.