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Construction output volume up 18.7% y.o.y. in May

Construction

The volume of construction output in May 2021, based on raw data, surpassed the previous year’s level by 18.7%, according to data by the Central Statistical Office (KSH).

The output of the two main groups of construction developed inversely: the construction of buildings rose by 38.6% and civil engineering lessened by 0.8% compared to May 2020.

Out of the three divisions of construction, output volume grew by 43.9% in the construction of buildings, and fell by 7.3% in civil engineering. Production increased by 22.9% in specialized construction activities.

The volume of new contracts concluded rose by 11.8%, within it the volume of new contracts for the construction of buildings went up by 29.2%, the volume regarding civil engineering works went down by 3.2% in relation to the May 2020 base.

The volume of the May end-of-month stock of contracts at construction enterprises was 11.3% above the end of May 2020 level.

The volume of contracts increased by 21.9% for the construction of buildings and by 4.9% for civil engineering works compared to the previous year.

In the first five months of 2021, construction output rose by 1.3% compared to January-May 2020.

"The growth in the performance of the construction industry is taking place against a backdrop of significant cost increases, as after the previous calmer period, the global market for raw materials has seen a strong, in most cases double-digit price increase since the third quarter of last year. The price of steel, for example, went up by 80% in 8 months,"  commented Tibor Földi, chairman of the board of directors of Cordia International Zrt.
 
"The significant cost pressures mean that further increases in the price of new housing are inevitable, but our experience suggests that buyers are not yet aware of this," he said.

Földi pointed out that "as a significant part of the building materials used in Hungary are imported, these effects are spreading to affect Hungarian developments, and the continuous increase in the price of building plots is also pushing up the price of new housing."

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