Construction industry pulled itself together and the order portfolio shows a favorable picture

Notwithstanding that the Hungarian construction industry has achieved a growth in March, the first quarter ended in a small loss based on the volume of production. However, the end-March order portfolio is higher than a year ago and it is encouraging for the future.

Hungarian construction industry, which started the 2021 year ambiguously, stepped on the gas in March although it showed a vigorous growth until appearance of the pandemic in Hungary. The annual volume of production grew by nearly 30 per cent in 2017, and then by 20 per cent in 2018 and 2019 and then, partly due to the unfavorable impacts of the pandemic the sector could register a decline of ample 9 per cent in 2020.

This March the volume of construction production increased by 4.3 per cent in an annual comparison and a 11.5 per cent extension has occurred compared to the previous month. The increase is attributable also to the fact that the sector performed poorly in last March and this February.

"The construction statistics were rather hectic in the last months. The 7 per cent increase in January was followed by a more than 17 per cent decline in February and now the annual increase exceeds 4 per cent. Owing to the above, the sector closed the first quarter in a minus of 2 per cent" - said Tamás Vida, CEO of KÉSZ Group.

He added: "According to the data relating to long-term performance, the volume of production exceeded the 2015 monthly average by near 56 per cent in March. Although there were better figures before appearance of the epidemic in Hungary, if we manage to keep the impetus in March, the sector can work off the drawback and begin to grow."

According to Tamás Vida, the development of contract and order portfolios is favorable from the point of view of the sector's performance expectable in the next period. At the end of March the volume of construction contracts was 13 per cent higher than a year ago. The value of contracts exceeded 2600 billion forints at the end of March. According to the CEO of KÉSZ Group, construction projects may have an important role in restarting after the economic decline caused by the epidemic. Growth of the sector may be assisted by the development and construction projects based on state and EU funds to be started in the next period.