CONFIDENTIAL # 3
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regards residential property, demand, particularly for small and medium-sized flats, was maintained at a high level. Potential buyers were, however, becoming more cautious and selective at the prevailing price level, in face of the abundant supply of flats.
12.
Caution should be exercised in interpreting figures on investment in property, in view of the time taken to complete projects. Capital expenditure is measured at the time the construction work is undertaken, while consents to commence work are given before the work starts and thus before any significant expenditure has actually been incurred, and completions are recorded after all work is finished. projects, the highest level of expenditure will occur either in a year other than that in which consent is given and/or than that in which the project is completed.
For many
(b) Capital expenditure on building and
construction
13.
According to the preliminary estimate of expenditure on the GDP in 1987, expenditure on building and construction by the private sector grew by 6% in real terms, following an increase of 2% in 1986 (Table 1). But the growth rate in second half of 1987, at only 3% in real terms, was
This significantly lower than the annual figure. was almost certainly largely due to the shortage of construction workers, which resulted in the capacity of the building and construction industry being under intense pressure. The shortage of certain essential building materials, such as steel
CONFIDENTIAL # 3