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Cameron brightens gloomy Q3 outlook, says RICS

Construction workloads were flat in the third quarter of 2011 while expectations were gloomy before the government’s announcements on housing market support.

But despite the downbeat responses to its latest Construction Market Survey, the Royal Institution of Chartered Surveyors said the mood could change after David Cameron announced a £400m investment fund to boost housebuilding projects across the UK this week.

The latest research shows that one per cent more chartered surveyors reported workloads falling rather than increasing, the lowest reading since Q4 2010. Over half of all respondents reported no change in workloads from the previous quarter.

Chartered surveyors say they are continuing to provide quotes for work, but many of these projects are not going ahead.

RICS chief economist Simon Rubinsohn said:  “The construction sector suffered in the third quarter of this year, as a combination of economic uncertainty, large cuts in public sector programmes and a lack of available finance for development impacted on the industry.

But he added: “The government’s housing announcement should gradually provide some much needed help and we are particularly attracted to the provision of funds for small and medium size developers.

“However, it remains to be seen whether the scale of the package really is sufficient to counter the negative factors depressing activity and profits across the sector.”

The private commercial sector saw rising workloads in the third quarter of 2011, but even this was subdued at a net balance of +7 per cent. Public sector workloads continue to show the largest falls, particularly in public housing, where 20 per cent more surveyors reported a fall - the most negative reading since Q4 2009.

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