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Five year construction forecast by BCIS

Published: 27/01/2020

BCIS predict tender prices to rise by 26% over the next five years (from Q3 19 to Q3 24). This rise is expected to be driven predominantly by input cost pressures over the first year of the forecast period, rising by 3%. Upward pressure on site rates is also expected to put upward pressure on tender prices during 2021 and 2022.

The forecast includes the following:

  • 32% increase in new construction output
  • 19% rise in building costs
  • 26% increase in tender prices
  • 2% per annum UK GDP growth
  • 3% per annum annual inflation rate
  • Interest rates rise to 1.5% by 2023
  • Depressed sterling exchange rates
  • Tariffs on imports, oil prices, and sterling exchange rates to be the main risk to material prices
  • Nationally agreed wage awards will be affected by restrictions in the availability from 2021

BCIS expects uncertainty associated with UK leaving the EU in January 2020 to continue to affect the private commercial sector, specifically retail subsector. In addition, new office construction is also expected to suffer from the uncertainty.

Please speak to our 
Development Team to find out more.