BCIS predicts a total fall of 14.9% before recovery in 2011
The price of new construction work fell 4.9% in the first quarter of the year, according to the Building Cost Information Service.
From their peak last year, prices have fallen 6.4%. BCIS predicts that tender prices could fall 14.9% from that time until they start to recover in 2011.
The organisation said the fall in prices was in largely owing to reduced workload. New orders fell 19% in the first quarter of the year, and were 38% down on a year earlier.
Meanwhile, costs are not rising as steeply, which will be a relief to contractors whose margins have narrowed. Materials costs rose 4% between January and March, compared with 7.7% in the previous quarter. Wages remained constant at 4.9%.
BCIS expects workloads to continue falling sharply throughout 2009.