After increasing by 7 points in the third quarter‚ the FNB/BER building confidence index remained flat at 48 points in the fourth quarter‚ according to the FNB/BER index released on Wednesday.

This is the highest level of the index - along with 3Q 2013 - since 2008. The current level indicates that there is an even split between those respondents satisfied with prevailing business conditions and those that are not. Compared to 3Q‚ changes in confidence levels took place among retailers of building materials (+10)‚ manufacturers of building materials (+6)‚ main contractors (+4)‚ sub-contractors (+4)‚ quantity surveyors (-11) and architects (-13).

The biggest jump in confidence was registered by retailers of building materials. Building retailer confidence‚ now at 66‚ is at its highest level since 2008. “The continued increase in sales as well as rising profits has buoyed the confidence of building material retailers. More importantly however‚ this sustained improvement indicates that there is indeed activity taking place‚ albeit at the lower end of the market” said Sizwe Nxedlana‚ chief economist at FNB.

Confidence of building material wholesalers (not included in the composite index) also rose sharply during the quarter. Besides the recovery in the lower end of the market‚ 4Q2013 also saw a rise in main contractor confidence. After slipping by 2 index points last quarter‚ main contractor confidence edged up 4 points to 47 in 4Q 2013.

However‚ this was mainly led by a spike in non-residential confidence while confidence of residential main contractors declined marginally. However‚ the slow pace of the recovery in profits continues to weigh on confidence. “Despite a loosening in tendering competition and a modest revival in building activity‚ profitability has remained flat for most of the year‚” said Nxedlana.

The rise in building activity of main contractors and increased sales by building merchants also helped support domestic sales and production by manufacturers of building materials. This‚ along with an increase in export sales saw the confidence of manufacturers of building material rise to 56 index points in 4Q 2013.

Confidence of sub-contractors was also marginally up in 4Q. However‚ as with main contractors‚ the non-residential sector noticeably outperformed the residential sector. Of concern is the slowdown in work within the building pipeline. The confidence of both architects and quantity surveyors fell by double-digit figures after showing a sustained improvement over the past few quarters. “The fall in confidence of architects and quantity surveyors is substantiated by a general decline in the amount of work conducted‚ which highlights the fragile nature of the current recovery” said Nxedlana.