A steep rise in private new housing and commercial work returned construction to growth in August.

Monthly construction output increased by 0.4% in volume terms, offsetting a decrease of 0.4% in July.

The recovery was driven by a 1.6% growth spurt in new work, as repair and maintenance fell by 1.0%.

At the sector level, five out of the nine industry markets grew. The main contributors to the monthly increase were private housing new work, up 3.4% and private commercial new work, up 2.2%.

In the new work sector only public new housing activity slipped, falling by 2% as social housing providers focus spend on maintenance and upgrade work.

The three-month trend figure shows construction output now in recovery with 1% growth in the period to August.

Clive Docwra, managing director of property and construction consultancy McBains, said: “After July’s surprise fall in output, the construction industry will breathe a sigh of relief.

“Despite current conditions remaining fragile, our clients are telling us that confidence is returning in many work sectors, helped by factors such as proposed planning reform and the cost of borrowing expected to fall.

“All eyes will now be on the Budget later this month where the industry hopes the Chancellor will pull a rabbit or two out of the hat to help encourage further growth.”