The First National Bank (FNB)/Bureau for Economic Research (BER) Building Confidence Index dropped to 25 in the first quarter of this year, from 32 in the fourth quarter of 2018.
This 7-point decrease resulted in the index nearly reaching an eight-year low.
The current level indicates that 75% – the majority – of respondents are dissatisfied with prevailing business conditions.
The fall in confidence was mainly owing to a deterioration in building activity, off an already low level.
The overall results suggest an intensification of the weak demand conditions plaguing the sector over the past few quarters, with little relief on the horizon, FNB said on Monday.
The only positive in the first quarter’s results was an uptick in the confidence from architects to 36, from 26 in the fourth quarter of 2018, supported by an improvement in activity.
The further decline in the index this quarter was supported by the fall in building demand. No improvement is expected over the near term.
“Building activity has been poor for a number of quarters and in a way it was difficult to see how it could deteriorate further to such an extent. However, that is what transpired this quarter,” commented FNB property economist Siphamandla Mkhwanazi.
“A recovery, if one were to only look at this survey, is still some way off”.