UK construction output is estimated to have fallen by 2% in the three months to January 2026 – the fourth consecutive fall in quarterly output, according to the latest figures from the Office for National Statistics (ONS).
Over the three-month period, new work and repair and maintenance work fell by 3.2% and 0.4%, respectively. At a sector level, seven out of the nine sectors fell in the three months to January 2026, with private new housing activity falling by 6.3%.
Monthly construction output is estimated to have grown by 0.2% in January 2026 following three consecutive monthly falls. The increase in monthly output came solely from an increase in repair and maintenance work, which grew by 3.3% – new work fell by 2%.
Clive Docwra, managing director of McBains, said: “Following 2025 ending in disappointment, January’s return at least shows some growth, albeit as a result of repair and maintenance. But it’s clear from today’s figures that investor appetite for major projects remains weak, with new work falling by 2% in January, and the longer-term picture over the three months to January showing a similar fall in output.
“The worry, of course, is that along with an already fragile economic climate, the Middle East crisis will impact construction by driving up material costs and disrupting global supply chains, so the outlook for 2026 is already looking bleaker than expected.”
Terry Woodley, MD of development finance at Shawbrook, added: “Despite subdued expectations, the construction sector has started the year with a small, but welcome increase in output. Repair and maintenance stood out as the main contributor to this increase, potentially reflecting continued efforts to support housebuilding and address planning system constraints.
“Looking ahead, activity is expected to remain modest. The annual construction output increased by 1.8% in 2025 compared to 2024, making it the fifth consecutive year of annual growth, which is a testament to the sector’s resilience. Property developers should continue to take a long-term approach when assessing business plans and consider engaging with a broker to explore funding options, particularly where flexibility is important.”
