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Pressure mounts on construction industry

Friday, Jan 23, 2009

The crisis in the construction sector is aggravating on both sides of the Atlantic, showed the latest data about the US and Europe.

Housing starts in the EU fell by 1.6% in November compared to October, when they rose 0.5%.

Bulgarian companies broke ground on 6.1% fewer new properties month-on-month in November, ranking the country among the bloc’s worst performers after Portugal (- 0 6.5%) and Slovenia (- 20.3%), according to statistics of Eurostat, the EU's statistical office.

On an annual basis, however, Bulgaria’s new-built construction market expanded 2.4% in the year through November, although slowing down from 14.9% in October and 17.1% in September.

Housing starts in the eurozone dropped 4.7% for the 12 months, with the UK reporting a 6.3% fall and Spain slowing September’s staggering 24% plunge to 9.7% in November.

Yet another bleak forecast came true in America yesterday when the Commerce Department unveiled a 16% monthly drop in housing starts for December, hitting a 50-year low, down 33% from the summer of 2007.

Building permits in the US, an indicator of future projects, were also at a record low.

“The housing industry continues to confront unprecedented downward pressure,” Jeffrey Mezger, CEO of KB Home, one of the biggest US construction companies, told Bloomberg.

Source: Dnevnik a.m.