Will Brexit Increase Home Improvement Costs?
We understand – you are sick of reading about Brexit; we all are! However, if you are contemplating performing some home improvements to your house in the near future, it may be worthwhile giving the timing some thought.
Regardless of your standpoint when it comes to Brexit, the world as we know it will unlikely cease to exist on March 29th, 2019, nor will it be that different from the 28th to the 30th. The influence of Brexit on the construction sector has been rather gradual; but the point of the matter is that changes are already being experienced and an influence is being felt when it comes to home improvement costs.
Cost of Home Improvement
The answer is both yes and no – a true politician’s response if ever there was one! The influence of Brexit, or more accurately the influence of the referendum has placed a ‘squeeze’ on the labour market.
According to the Office for National Statistics or ONS, the difference between EU citizens leaving the United Kingdom and those entering the United Kingdom sank to a low of 87,000 in 2018 – the lowest amount since the year before December 2012. This shift, according to the ONS, can be explained by the increase in emigration of EU citizens and the reduction in immigration of EU citizens.
What may be more significant is the net migration to the United Kingdom from A8 countries, such as the Czech Republic, Poland, Lithuania and Hungary; all countries that joined the European Union in 2004. This statistic saw 47,000 departures from the UK and 45,000 arrivals to the UK.
Significance of Statistics
Well, it is significant as the majority of these migrant workers were utilised in the construction and building industries. The window and door manufacturing companies have, as a whole, recruited mostly from A8 countries as reported by the KJM Group. With fewer people entering the UK from these countries, it is now more difficult to recruit labourers and the industry’s employment costs are increasing dramatically.
At the same time, more individuals are entering employment. According to reports from the Office of National Statistics, the wages in the UK during October were 3.1 percent up when compared to the same three months from August in 2017. This represents the largest average wage increase since the 2008 economic collapse in the country.
Is This All Caused by Brexit?
It is difficult to argue categorically one way or another. What we can consider is that labour costs are on the increase for a plethora of reasons and, historically, these tend to result in a price increase for the consumer. Another concern is the constant falling of the pound.
So, What Are the Long-term Predictions for Home Improvement Costs Based on Brexit?
It is clearly difficult to forecast anything with accuracy based on the current timeline. The Construction Industry Training Board or CITB published a Green Paper in the summer suggesting that Brexit would have a creeping impact overall construction industry.
This showed that approximately one-third of builders were concerned about their ability for skilled worker recruitment, with at least 37 percent of the workers currently working in the industry being non-UK citizens. It was also stated that builders had also noted the building materials cost would rise by 3 or 4 percent in the final year, and the costs were being passed to homeowners.
In This Case, What Would Be the Reasons for Brexit to Be a Good Time for Investing in Energy Efficient Doors and Windows?
If you could examine where we currently are, on balance, and if you were considering and could afford energy efficient doors and windows; then it may be useful to bring the purchase of these products forward. The reason is not due to use making a case for doomsday, but merely that we are not aware of what will happen in the future. Right now, we know the cost of new energy efficient products, where we are, and what is affordable.
This being set aside, it may be worthwhile to consider what is occurring in the energy market.
When looking at the energy sector, you can see that home heating costs are on the increase. According to British Gas, at the end of August there was a 4 percent increase in energy expenses – a jump on the average amount from £44 to $1,205 per annum.
If you can afford to do so, it can be beneficial to keep a lid on the rising costs by increasing your home’s energy efficiency with new energy efficient doors and windows.