According to Glenigan, the value of residential construction activity fell by 24% alone during the quarter to the end of May.

Private housing construction-starts dropped 28% against the preceding three months and nosedived 50% against 2025 levels.

Social housing performance also fell, albeit slightly less severely, decreasing 14% against the preceding three months and finishing 17% down on the previous year.

Overall construction dipped with on-site starts declining 7% during the quarter, finishing 23% below 2025’s levels.

•   The Finance Professional Show 2025: The Video
•   UK construction struggles as Iran war continues
•   Social housing construction surges 230%

According to Glenigan, this can partly be attributed to investor sentiment being impacted by economic uncertainty from political instability and the ongoing Middle East war.

“On the housebuilding front, developers continue to take a cautious stance, reassessing and rescheduling planned project starts in response to weakening demand and tighter financial conditions,” said Allan Wilen, economic director at Glenigan.

“While strong growth in offices, alongside modest gains in retail, education and health, helped support non-residential starts during the three months to the latest period, this was insufficient to offset continued declines across residential and civil engineering activity.”