Property & Construction Daily

The Property & Construction Daily provides a sector-specific comment from leading analyst Alastair Stewart. His daily perspective provides a round-up of market statements, news, economics and views from the property and construction sectors.

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April 2, 2024

RNWH | Economics – Mortgage approvals rise for fifth month as transactions recover; Prices continue to rise, Nationwide | Fortnight ahead

Company news

Renew Holdings (RNWH, 924p, £731m)

Engineering services group supporting UK infrastructure. HY (Mar) trading update. “Trading for the first half is in line with management’s expectations and the group continues to experience strong demand for its services across all key markets. The order book remains underpinned by long-term framework positions and is at similar levels to that reported in January 2024 providing excellent visibility into the second half. The half-year net cash position is expected to be in-line with expectations and the Board remains confident of further progress in the second half of the year”.

Economic data

Mortgage approvals rose for the fifth consecutive month in February, rising M/M by 7.7% to a 17-month high of 60,383, seasonally-adjusted, as reported within the Money and credit data from the Bank of England. This follows a 7.3% increase in January and represents a 36% cumulative increase since September and a 51% improvement since the post-mini budget low of 39,888 in January 2023 (below). The ‘effective’ interest rate on newly drawn mortgages fell by 29 basis points, to 4.90% in February, while that on the outstanding stock of mortgages increased by 7 basis points to 3.48%. Next release, 30 April (09:30).


Housing activity. Completed housing transactions increased for the second straight month in February, rising by 1.2% to 82,940 seasonally-adjusted, following a 1.5% uplift in January, according to HMRC data (from Thursday). The data, which covers mortgaged and cash transactions, is still 17% below the 10-year average of 100,314 (below). Every UK country except Scotland recorded Y/Y declines on a non-seasonally-adjusted basis: England -2.9%, 62,890; Scotland +0.7%, 5,540; Wales -0.6%, 3,260; Northern Ireland -2.9%, 1,670. Next release, 30 April (09:30).

Viewpoint: Mortgage approvals are recorded near the start of the home buying process, transactions (a more comprehensive measure), at the end. The big rise in approvals data indicates there should be a significant recovery in completed transactions over the next few months.

House prices rose for the third consecutive month in March on a non-seasonally-adjusted basis to £261k (‑0.2%, seasonally-adjusted), bringing the Y/Y rate up from +1.2% to +1.6%, according to the Nationwide. The highest Y/Y increases (for Q1 24)  were Northern Ireland (+4.6%, £181k), the North of England (+4.1%, £159k) and Scotland +3.7%, £179k); biggest falls were South West (‑1.7%, £297k); East Anglia (‑1.3%, £269k) and South East (‑1.0%, £329k). London turned positive, rising 1.6% to £520k.

Fortnight ahead

02 Apr 24 – Fortnight ahead
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