SBV: Difficult year for main construction trade
Sales in the Swiss main construction sector fell by almost nine percent in 2015 compared with the previous year. The decline in residential construction was particularly marked. These are the findings of the quarterly statistics published by the Swiss Association of Master Builders (SBC).
In 2015, sales in the main construction sector fell by 8.6 percent to CHF 18.4 billion. Building construction suffered greater losses than civil engineering, mainly due to residential construction, according to the SBC. Various factors had led to the decline: On the one hand, the comparative year 2014 was an exceptionally good year, not least due to weather conditions. On the other hand, demand for apartments was not quite as high in 2015. According to the SBC, the reasons for this are "certain saturation effects", as also shown by a rising vacancy rate, as well as the restrained economic development. In the mountain and tourism regions, the effects of the second-home article also had their full impact in 2015. In some places, residential construction activity came to a virtual standstill, writes the Association of Master Builders.
According to SBC, however, order intake stabilized in the fourth quarter of 2015. Work in progress at the end of 2015 was also slightly higher than in the previous year. The fundamental factors for the construction industry, especially low interest rates and continued population growth, also remain intact despite the difficult macroeconomic environment, it adds. However, the downside risks are significantly greater than the potential for positive surprises. In particular, a sharp rise in interest rates and a sharp decline in population growth would be devastating for residential construction. However, neither of these seems very likely at the present time. Overall, SBC expects construction volumes in 2016 to be similar to the previous year. (mr)
