Friday, May 20, 2016

UK underfloor heating market to grow by 15% to 2020 in value terms

After recovering well from the challenging economic conditions seen in recent years, the UK underfloor heating (UFH) market has continued to grow steadily, with growth of 9% in 2014 and a further 4% in 2015, and is now estimated to account for around 6.5% of the total UK heating market. There are two main types of underfloor heating; water-based (or hydronic) and electric systems. Some projects may involve a mix of both types of systems, often known as a hybrid solution. In terms of value, wet underfloor heating accounts for the largest share with electric UFH a relatively small market by value.
Whereas UFH products were once potentially seen as more specialist and a luxury investment within the domestic sector, these products have now become more mainstream and UFH currently represents one of the fastest growing areas within the UK heating market. Environmental concerns and rising energy bills have been partly responsible for driving demand, as well as wider acceptance of these more aspirational products. An array of product innovations has also made UFH systems easier to install, broadening their appeal for the retrofit market. This includes systems, both wet and electric, which can be laid over existing floors, thereby minimising disruption and speeding up installation. Low profile UFH options are now widely available, which reduce the impact on floor height, enabling greater flexibility.
The domestic UFH sector, including new build activity by housebuilders, the self-build market and RMI / DIY retrofit projects in residential homes, accounts for the largest share of the market by value, though the use of UFH also remains strong in the non-domestic sector. Whilst large-scale health and education projects have declined, there are still opportunities in the care home, industrial, warehousing, leisure and entertainment, office and retail sectors. The desire to reduce energy costs and to achieve greater energy efficiency is beneficial for the non-domestic UFH market, as systems can typically work at lower temperatures, providing radiant heat across a large surface area compared to more localised heat sources. 
There is a growing DIY sector for UFH, particularly in the self-build and retrofit markets, with many products now available for direct sale online. The sale of complete UFH packs as a ‘one stop solution’ has also fuelled growth, at the lower end of the market in particular. The continuing trend towards open-plan design favours use of UFH, since it is hidden beneath the floor, with no need for wall mounting, and this is a particular benefit in areas such as kitchens and bathrooms where space may be at a premium. Hard flooring also continues to grow in popularity, with greater use of stone and timber finishes as the preferred design choice, and systems are available for use under stone and ceramic tiles as well as other flooring materials.
“Following a period of consolidation amidst challenging economic conditions in recent years, the number of outlets distributing UFH is now increasing as the market grows” said Keith Taylor, Director of AMA Research. “However, many of these are value orientated and the traditional supply routes, such as direct supply and through merchants, are expected to maintain their share by value. There is likely to be some polarising of the marketplace between lower cost and more premium products.”
Prospects for continued growth in the UK underfloor heating market remain positive for 2016 and beyond, given optimism and recovery in the housing market, coupled with rising levels of consumer confidence and spending. Whilst the private non-residential sector is also showing signs of recovery, with potential for further business investment, the public sector remains severely constrained given reductions in public sector spending. Underfloor heating products are now widely marketed alongside renewable technologies and there is likely to be continued growth in this sector. Ease of installation continues to be an important issue in the construction sector, given a skills shortage and a need to reduce both build time and cost, with UFH systems suitable for installation in bathroom/kitchen PODS, as well as precast concrete flooring. By 2020 the market value for the underfloor heating market (UFH) is forecast to have increased by around 15% compared to the market size in 2015.

The ‘Underfloor Heating Market Report – UK 2016-2020 Analysis’ report is published by AMA Research, a leading provider of market research and consultancy services within the construction and home improvement markets. The report is available now and can be ordered online at or by calling 01242 235724.

Thursday, May 19, 2016

Housing set to drive strong growth in the UK prefabricated volumetric buildings market

The UK market for volumetric modular buildings and portable accommodation has improved over the last couple of years, underpinned by recovery in the general economy and in non-domestic construction. Market demand declined between 2008 and 2013, but has seen improvement since then, underpinned by demand for site accommodation on major infrastructure projects and in the events sector, and recovery in key applications for offsite construction such as student accommodation and schools.
Products are broadly split between ‘permanent’ and ‘semi-permanent’ buildings, on the one hand, which are usually constructed from two or more modules, and portable accommodation. The latter sector mostly comprises a wide range of single module products hired or leased for short periods.
Key areas of demand for volumetric permanent and semi-permanent structures are the healthcare sector, social housing apartments, sports facilities and commercial offices. Between 2005 and 2013, by far the largest application for volumetric construction had been MoD single living accommodation, driven by major building programmes, notably Project SLAM and Project Allenby/Connaught. However, the end of these contracts contributed towards a sharp downturn in the industry as a whole and demise of some leading suppliers.
Distribution channels include direct sales to end users and main contractors and the hire / leasing market. The hire sector comprises dedicated hire divisions or subsidiaries of manufacturers of modular building systems, independent companies specialising in the hire /rental of temporary accommodation, and general plant hire companies.
Over the medium term, a sustained recovery in key end-use sectors is expected to sustain demand, and it is estimated that the overall market will have grown by around 25% by 2020. Growth rates are likely to remain high over the next 2-3 years before stabilising at around 3% towards the end of the forecast period. However, in the longer term, housing is a sector offering great potential where penetration rates for volumetric construction remain low.
“The ongoing shortage in new housing output, which is way below the aspirational targets of the government, coupled with shortages of skilled tradesmen has been widely recognised as a potential driver for offsite solutions” said Andrew Hartley, Director of AMA Research. “The government has granted funds to a leading construction firm to build a factory dedicated to manufacturing housing and, in the social housing sector, procurement group LHC implemented a 4-year offsite housing framework to stimulate demand for volumetric and panelised housing systems.”
One other key factor expected to drive up demand for offsite construction is Building Information Modelling which is now becoming mandatory for public sector building projects. A key advantage with BIM is that it can streamline building design, procurement, construction and maintenance processes. It should facilitate standardisation in design, where required, and in turn favour the use of offsite construction. BIM will also enable sustainable energy and building approaches to be incorporated from the outset, which ought to favour volumetric buildings as these have better airtightness properties than traditional constructions.
The ‘Prefabricated Volumetric Buildings Market Report – UK 2016-2020 Analysis’ report is published by AMA Research, a leading provider of market research and consultancy services with over 25 years’ experience within the construction and home improvement markets.  The report is available now and can be ordered online at or by calling 01242 235724.

Thursday, May 12, 2016

Self build housing market set to grow by 5% in value terms in 2016

Recent developments in the self build housing market in the UK reflect the wider problems of the housebuilding sector. Demand remains strong and output could be so much higher without the constraints of land and financial support. The UK continues to have one of the lowest rates of self building - around 10% of new private sector house-building, compared to countries such as Austria, Belgium, Italy and Sweden where self build rates are above 65%. However, the last couple of years have seen a great deal of activity in the self-build sector through Government incentives and greater media exposure, and an improvement in the general economy has also helped the market increase in value, by an estimated 5% in 2015. Estimates of volumes vary according to different definitions, but AMA estimate current self build completions at around 12,000 dwellings.
Councils are now actively trying to enable more self and custom build development, and local community groups are progressing with neighbourhood plans and Community Right to Build projects, while the Government has also established its Right to Build scheme. The Government has also taken steps to raise the profile of self-build through a series of measures including easing constraints in planning, cutting taxes for self-build developments, providing a number of funds to assist individuals and communities to self-build, and by releasing public land for self-build projects. There is also increasing activity from developers, including some large housebuilders, to enable multi-unit self/custom build projects and a growing number of new entrants into the ‘custom build developer’ market.
Despite these positive influences, self-build completions are still below Government targets and a number of challenges still constrain growth in the sector. The main challenges to undertaking self build projects continue to be access to land and finance with additional challenges in the planning process and associated regulations. In the current financial climate, self-builders attempting to obtain a mortgage still face a more restricted choice of lenders in the market willing to lend money on a property which has not yet been built. As a result, significant personal financial deposits by self builders are still required.
Product systems in the self-build market are a mix of timber frame and traditional methods, with kits continuing to represent a significant share of the self-build sector. In terms of key distribution and material supply channels in the self-build market, Builders/Timber Merchants represent the largest distribution channel with an estimated share of around 50% of the total materials market in 2015, followed by self-build specialists, online channels, specialist distributors etc.
Future growth in the self-build market is likely to be underpinned in part by Government aims to drive forward change in the self-build sector, which is now receiving more attention in the form of grant funding, tax reductions and an easing of land and planning constraints. The Government’s Self-build and Custom Housebuilding Act, which gained Royal Assent in March 2015, will now require local planning authorities to establish local registers of custom builders who wish to acquire suitable land to build their own home. It also requires local authorities to give consideration to the demand on their local register when exercising planning functions.
The Government’s Housing and Planning Bill also includes several measures to facilitate self and custom build, including placing a duty on councils to allocate land. Our value estimates suggest steady forecasts, with self build values rising by around 5% in 2016, reflecting an expectation in a modest rise in self build volumes and material and labour costs. Thereafter, the self-build market is expected to grow steadily by around 7-10% per annum to 2020. In terms of the number of self build dwellings, forecasts can vary widely.
“Government plans, announced in 2011, to double the output of self-build housing to provide an additional 100,000 self build units by 2021 are likely to be tempered by a number of factors, including the uncertain economy and wider housing market, a reluctance of lenders to make mortgage funding widely available, constraints in the planning system and ongoing difficulties surrounding the availability of land for self-build projects – all longstanding but generally unresolved issues to date” said Andrew Hartley, Director of AMA Research. “Saying this, new measures are being introduced to alleviate some of these issues and our forecasts for the self build sector are positive in the medium term.”

The ‘Self Build Housing Market Report – UK 2016-2020 Analysis’ report is published by AMA Research, a leading provider of market research and consultancy services with over 25 years’ experience within the construction and home improvement markets. The report is available now and can be ordered online at or by calling 01242 235724.

Student accommodation sector now represents a major growth market for private sector investment

Despite the increase in tuition fees, student numbers continue to expand in the UK higher education sector, placing greater pressure on university teaching, research and accommodation infrastructure. As a result, investment in the sector is increasing and there is a buoyant pipeline of ongoing new work at many universities as part of major long-term development programmes. In addition, the purpose built student accommodation (PBSA) market has emerged as a key investment sector over the past decade, attracting major interest from developers, investors and private operators in 2015.
The latest HEFCE financial forecasts show that the higher education sector is planning on delivering a substantial increase in capital investment up to 2017-18, as competition to attract overseas students intensifies and universities face the impact on the removal of the cap on student numbers from 2015-16. Despite the severity of budget cuts which have hit many universities’ finances, many are still going ahead with projects as planned, and an ongoing backlog of refurbishments and upgrades is also boosting the higher education construction pipeline. However, most HEIs have had to review the ownership and maintenance requirements of their estates and consider various outsourcing options. This has led to an increase in partnerships between universities and private sector developers and investors, especially in the student accommodation and R&D sectors.
While decent accommodation is a key part in universities’ marketing strategy to attract new students, only around 18% of students are currently living in university operated halls, and there remains an acute undersupply of student accommodation in many regions. The ‘commercial’ student accommodation sector is one of the fastest growing sectors in the property market and there are now over 200 commercial PBSA operators in the market. Over the past few years there has been a dramatic change in the balance of supply between institutional and private providers in the student accommodation sector – AMA estimate that in 2016 some 46% is now accounted for by private providers (equivalent to over 270,000 bed spaces) – and a large portion of the shortfall in university owned accommodation is expected to continue to be met by commercial providers going forward.
“In recent years, there has also been a marked shift in the type and range of PBSA, with commercial operators focusing on the development of more expensive accommodation, most notably premium cost studio flats, with luxury accommodation offering features such as wall mounted flat screen TVs, boutique styling, designer furniture and VIP Bars, also coming onto the market” said Andrew Hartley, Director of AMA Research. “This type of ‘high end’ accommodation, aimed at attracting overseas and the wealthiest students, is unaffordable to many, and the concern is that there has been a continued decline of affordable accommodation, particularly self-catered non-ensuite rooms in cluster flats.”
In 2016/17, the outlook for the student accommodation and higher education sector in general remains positive, with student numbers expected to increase with the removal of the cap on student numbers. This is likely to benefit mid-high ranking universities, with developers targeting universities with large student populations such as Portsmouth, Aberdeen, Liverpool and Coventry, and is also expected to trigger rapid growth in the number of overseas students coming to the UK.
Universities are expected to continue to face considerable funding challenges over the next decade, while the PBSA sector has seen an increase in investment from overseas in the past couple of years, with the bulk of investment activity shifting from UK owner-operators to private equity firms, and also now onto global institutional investors. In the longer term, the accommodation market is forecast to remain characterised by undersupply in many of the major university towns across the UK, and growing student numbers - overseas student numbers alone are forecast to rise to 870,000 by 2020 – will ensure that the pipeline of new developments will remain buoyant over the coming years and according to AMA is forecast to grow to over 20,000 bed spaces per annum by 2020.

The ‘Higher Education and Student Accommodation Construction Sector Report – UK 2016-2020 Analysis’ report is published by AMA Research, a leading provider of market research and consultancy services with over 25 years’ experience within the construction and home improvement markets. The report is available now and can be ordered online at or by calling 01242 235724.

Shower Market Report - Key Facts

  1. The shower equipment market is expected to grow by over 16% in the next 4 years.
  2. Electric shower controls account for the greatest proportion of the controls market by volume with 53% of the market.
  3. Shower screens account for around 17% of the enclosures, screens and trays market by value in 2015.
  4. Traditional enclosure shapes account for around 53% of the enclosure market by value, though wetrooms/glass panels and walk-ins are gaining share.
  5. The shower accessories market is expected to grow by around 20% over the next 4 years.
These facts have been extracted from AMA Research's report 'Shower Market Report – UK 2015-2019 Analysis ', available from or by calling 01242 235724. 

Tuesday, May 03, 2016

Builders & Plumbers Merchants Market - Key Facts

  1. The builders and plumbers merchants market is forecast to grow by over 20% over the next 4 years.
  2. In 2015 it is estimated that the merchants’ sales accounted for around 9% of the total construction output.
  3. The market is dominated by a leading group of 5 organisations with almost 76% of the market.
  4. Key products for the merchants include the Plumbing and Drainage sector which accounts for 17% of their overall market.
  5. It is estimated that the merchants overall share of the cement and plaster materials market is around 24% of the market.

    These facts have been extracted from AMA Research's report 'Builders and Plumbers Merchants Market Report – UK 2015-2019 Analysis ', available from or by calling 01242 235724.