THE UK construction industry is suffering from a post-General Election lull, with housebuilders seeing expansion dip to a two-year low, a report has said.

The sector has lost momentum, with residential work limiting growth, despite higher demand.

According to a Markit/CIPS purchasing managers’ index survey (PMI), housebuilding remained strong in July, but lost much of its thrust gained in June.

Indeed, the report said activity in the division expanded at its second-slowest since June 2013, with civil engineering also sluggish.

However, commercial work bucked the trend, with the number of projects rising at their fastest pace since March.

The survey delivered a reading of 57.1 last month, which was down from June’s four-month high of 58.1 though well above the 50 figure used to separate growth from contraction.

Tim Moore, Markit senior economist, said the construction industry was somewhat stagnant.

He said: “July’s growth slowdown is the first for three months and perhaps a sign that the post-election impact on construction confidence has started to diminish.

“Commercial activity was a key growth driver during July, which partly offset ongoing weakness in civil engineering and softer residential building trends.

“Sustained growth across the UK economy has firmed up demand for commercial building work, with construction companies noting a particularly strong appetite for new developments.

“However, residential activity expanded at one of the slowest rates for more than two years, highlighting the housebuilding sector is struggling to gain momentum.”