The declining housing market and the effects of the credit crunch affected demand for all damp proof products in 2008/09. As a result, the market for damp proof courses and membranes (excluding roofing applications) is estimated to have fallen below £70m in 2009, though prospects for recovery in the medium term remain optimistic as housebuilding activity begins to pick up

Housebuilding volumes have declined by over 40% in the 2008-09 period, though have shown some signs of recovery since mid-2009 as prices and consumer confidence have slowly improved. However, an increasing proportion of domestic completions are flats and apartments, which has led to a decline in the volume of DPC (Damp Proof Course) and DPM (Damp Proof Membranes) in the new housing sector.

Up to 2007, the switch to flats had been offset to some extent by growth in Housing RMI and a much more buoyant non-residential construction market. Housing RMI is showing some signs of recovery, reflecting low interest rates and a switch to ‘improve rather than move.

The non-housing sector performed better than housing in 2008, with performance underpinned by above average growth in key sectors such as education, health, offices and retail. However, order levels dropped in 2008 due to the volatile economic climate, falling business confidence and a lack of available finance – which fed into construction activity in 2009, with sectors such as offices and retail falling rapidly, which had experienced large levels of speculative building and where there are currently substantial levels of available office space to let

However, this has been partially offset by sectors such as Education and health which have remained buoyant due to government spending commitments – though these are likely to se cutbacks from 2011 onwards.

The future of the damp proof products market depends on a number of factors in both the domestic and non-domestic sectors. For example, the continuing shortage of land will mean that more development will be on contaminated sites in the future with a consequent requirement to protect health and safety through the use of higher specification membranes to provide a barrier against harmful gases. In addition, Environmental and energy efficiency concerns are influencing the specification of damp proof products, with an increasing volume now manufactured from recycled materials.

The new build construction market is a major driver of damp proof products market performance. Indicators from this sector suggest that we are unlikely to see significant recovery in the market until 2011. However, housebuilding is likely to see earlier signs of recovery than commercial sectors, though growth rates will be gradual as major developers slowly recover confidence, with non-residential unlikely to offer major growth prospects over the next 3 years.