According to the Office for National Statistics (ONS), property prices increased by 10.4 per cent in the 12 months to October 2014. Although this was slower than the month before – which stood at 12.1 per cent – it is still well above the one per cent rate of inflation for November, with the average house price now coming in at £271,000.
The ONS figures will likely bolster the government’s plans to create more affordable housing. Indeed, the Chancellor’s overhaul of the stamp duty system in his Autumn Statement is also going to make it cheaper for people to buy homes, both of which will in turn provide a boost to the construction industry.
Campbell Robb, chief executive of Shelter, is one individual who has called for a greater number of affordable homes to be built. He said: "With the average house in England now costing more than ten times the average wage, millions of people are finding themselves stuck in the rent trap with little hope of ever saving for a deposit."
The affordable homes initiative is being supported by another government policy – which was announced on 15 December – that will see first-time buyers under the age of 40 receive a discount of at least 20 per cent on newbuild homes. This is going to increase demand for newly built residential properties, again fuelling activity among construction firms.
Housebuilding suffered dramatically when the recession hit in 2008 but with the economy steadily improving and more people now looking to get onto the property ladder, the construction industry is witnessing a healthy resurgence.