The total construction output in Northern Ireland has fallen by 4.1 percent in the first quarter of 2019, a new survey has found.

Contractors across the region took part in the latest Northern Ireland Market Intelligence Survey, with over half of respondents describing current tendering conditions as 'cold'.

Political instability caused by the absence of Stormont and Brexit uncertainty poses the greatest challenge to the region's contractors.

Despite these serious concerns, tender price inflation is expected to increase from 1.7 percent this year to 2.3 percent in 2020.

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Order books for contractors in Northern Ireland have also improved in the first half of 2019 when compared to previous years, but capacity still remains. The order books are on average 80.0 percent full for 2019/20, and currently stand at 64 percent for 2020/21.

The survey was carried out by Turner & Townsend.

The company's Director, Real Estate and Strategic Lead, Colm Lavery commented: "It has been a whirlwind year of uncertainty with the 'are we, aren't we' approach to leaving the European Union, combined with Stormont failing to return from dissolution, weighing heavily on the minds of contractors. They have also been feeling the effects as tendering conditions cool and construction output falls.

"The looming departure from the EU and low investor confidence remain key hurdles to the Northern Ireland market. Short-term outlook is understandably pessimistic. With some commentators talking of a recession, it may require a general election to provide the impetus needed to re-establish political certainty and restore confidence that the industry will improve."

(CM/MH)