Government figures show that monthly construction grew by 17.6 per cent in July this year, following June’s record-breaking 23.5 per cent rise.

However, despite the positive figures, July’s output was still 11.6 per cent below the level seen in February 2020.

On a quarterly basis, construction output dropped by 10.6 per cent on the previous quarter in the three months to July, with new work falling 9.7 per cent and repair and maintenance by 12.4 per cent.

A drop in private new housing construction was the largest factor within the negative new work figure, having plummeted by 17 per cent. Infrastructure, however, grew by 6 per cent.

McBains managing director Clive Docwra says: “Today’s figures will be welcomed by the construction sector as a sign of its continuing recovery, but in reality they need to be viewed in the context of an industry that experienced a record 40 per cent drop in output at the height of the lockdown.

“Construction is still a long way from being out of the woods and the upturn is extremely fragile, reflected by the fact the figures show that new work decreased by 9.7 per cent in the three months to July 2020, with private new housing work alone falling by 17.0 per cent.

“The big concern for the industry is if there’s a second spike and a further lockdown. The government needs to do all it can to ensure the sector maintains its recovery.

“On top of this, of course, a potential no deal at the end of the Brexit transition period is making investors nervous about committing to new projects. The prime minister may want the industry to ‘build, build, build’ but that’s difficult when many investors are saying ‘wait, wait, wait’ and holding off embarking on new developments until there’s greater clarity.”

A report from the Federation of Master Builders, meanwhile, shows that demand for new homes is at its lowest level since 2014.

The figure comes from the federation’s house builders’ survey, which covers SME house builders.

As well as reporting low demand, 48 per cent of housebuilders said that the planning system was restricting their ability to build new homes and 46 per cent said that a lack of available and viable land to build on was a concern.

The FMB wants to see support, including a boost in resources to local authority planning departments, a further extension to the Stamp Duty holiday, and more flexibility in the government’s home building fund, which the FMB says no SME in the sector currently uses.

FMB chief executive Brian Berry says: “SME house builders are facing the dual challenge of weakening demand and increasing constraints on their output. Taken in the context of Brexit uncertainty and the ongoing economic impact of the coronavirus, these conditions are hampering recovery in the housing market.

“The government needs to prioritise supporting recovery in the SME house building sector. SME builders operate in every community in England and support the government’s levelling-up agenda.

“They build high-quality, sustainable and beautiful homes in places where people want to live. Local builders also create local employment and training opportunities, as SMEs train almost three-quarters of the industry’s apprentices.”