A decline in building materials sales has left London lagging behind the rest of the UK in a market considered to be a key economic bellwether.
Latest figures from National trade body the BMF (Builders Merchants Federation) show London was the only region to decline, with the North East drastically outperforming the capital.
Year-on-year figures for Q2 in the BMF’s BMBI report show sales of building materials dipped in London, while the value and volume of sales increased nationally compared to April-June 2024.
The BMBI uses NiQ GfK’s point of sale tracking data to analyse merchant sales across the country, identifying national trends and monitoring regional variances.
It is considered a key indicator for the UK’s overall economic picture, and the strongest proxy for Repair Maintenance and Improvement (RMI) activity across the country.
John Newcomb, CEO of the national trade body, whose members have combined sales of £51.6bn and employ nearly 198,000 people, says a lack of confidence among London-based business and consumers is a major issue.
He said: “The BMBI shows that volume growth in London is just a quarter of that seen market wide.
“Lack of consumer and business confidence seems to be impacting the capital much more significantly that other areas of the UK.
“London is significantly more expensive that other regions, so a squeeze on household finances in the city could account for the lack of demand for home repairs and improvements.
“However, it has always been more expensive to live in London than to live in regions such as the North East and, historically, we have not seen demand for home repairs and improvements in the capital lag so far behind the rest of the UK.
“This divide highlights the growing disparity in confidence and investment across the country, and we do not believe that market forces alone will rebalance demand.”
The BMF is calling for the Government to create incentives for building projects and develop a national retrofit strategy to help stimulate the market.
John Newcomb added: “There needs to be sufficient intervention to raise consumer spending. Additional cuts to interest rates would be welcomed to boost household disposable income and increase business confidence.
“Incentives for housebuilding would help kickstart demand and support the Government’s own housebuilding targets, while much of the UK’s housing stock is relatively old and could benefit from home improvements to make properties more energy efficient.
“A national retrofit strategy would help rebalance demand in the RMI market.”
