17 Jan 2022
Construction is coming in from the cold
We’re so used to hearing that construction is part of the problem, says Mike Rigby, CEO of MRA Marketing, that it’s cheering that construction is now part of the solution.
Traditional forecasters look for regression in booms and busts, signs that a market or economy is returning to trend. But all the signs are that we are on the threshold of a new normal for construction.
While individual events are virtually unpredictable you don’t need special glasses to see the mega-trends that are changing our world and boosting construction. These six powerful trends will lift construction on to a new level for the next 10-20 years at least.
- 1. The population has grown faster than the rest of Europe and demographics make further growth inevitable. We are a crowded island, and we don’t have enough houses of the right sort in the right places. Housing has risen up the agenda because people need somewhere to live. Government can’t keep kicking this can down the road.
2. The 20-year trend separating homeowners into the Haves and the Have Nots received a further boost from the pandemic. Rising house prices have been adding to the housing wealth of the Haves – the Bank of Mum and Dad – older homeowners whose homes have risen dramatically in value over the last 20 years. They’re improving their homes because they enjoy the improvements and because they can. It makes financial sense to look after their most important asset.
3. We have the oldest, leakiest housing stock in Europe: around 20% of carbon emissions leak out of our homes and into the sky. Climate change is top of the agenda and unless we upgrade the insulation of our housing stock, we stand no chance of meeting carbon targets. Government please note.
4. During the industrial revolution people left the land to work in our factories and cities. Now they are migrating back. We’re in the middle of a mass movement, the biggest change in where we live and work in the last 250 years. It didn’t start with Covid. But last March when we were all sent home, we learned to work there. Now a lot of people want to stay because they like the flexibility and hate commuting; love the cleaner healthier air; and the extra living space. A recent survey found that 70% of senior board level managers in big companies in the UK think hybrid or some form of working from home is here to stay. Nearly 80% of the public thinks so too. Working from home is driving high prices in the housing market as people leave the cities to find more space to live inside and outside the home.
5. Our homes were never designed to live and work in. Most homes were made for sleep and the occasional meal, while living and working elsewhere. So people are adding living space or remodelling their homes to make it easier to work in, and spend their time in comfort.
6. Homes built on flood plains will need a lot of upgrading to keep them habitable. Around 5.2 million properties in England are at risk.
Fill your boots!