At a Glance:
UK construction output edged up 0.4% in Q1 2026, with a stronger 1.5% rebound in March.
Infrastructure is anchoring the market with year-to-date growth above 5% and a £30bn live pipeline.
Forecasts for 2026 diverge, with total output growth seen between 1.7% and 2.8% and infrastructure outpacing the wider sector.
Private new housing remains the drag, with output down 6.5% in the latest three‑month period despite policy focus on viability and planning reform.
Megaprojects including HS2, the Lower Thames Crossing and new nuclear continue to underpin the UK’s £725bn 10‑year infrastructure strategy.
Today’s update: hard data from ONS and industry forecasters point to a tentative upturn in UK construction, led by infrastructure and non‑residential work, even as private housing continues to weaken. Alongside this, policy and legal commentary shows planning reform and viability testing moving centre stage in the push to unlock 1.5m new homes and sustain the £725bn long‑term infrastructure strategy. Here’s what you need to know to stay ahead today.
Ongoing Stories
Following earlier coverage of skills and delivery risks to the UK’s long‑term pipeline, new ONS data and market reports now frame that debate against a 0.4% Q1 output rise and a growing reliance on infrastructure to carry overall sector growth. (Sources: ONS; Gleeds)
Planning reform and housing delivery, previously discussed in the context of the Planning and Infrastructure Bill, continue today with new focus on viability testing, rent reform and building safety as key levers for meeting the 1.5m homes target. (Sources: Housebuilder; Ashurst; Farrer & Co)
The UK’s multibillion‑pound megaproject portfolio – including HS2, the Lower Thames Crossing and Sizewell C – returns today as context for the £725bn 10‑year strategy, now set against evidence that infrastructure is the strongest performing segment of the market. (Sources: Gleeds; public project reporting)
Top 5 Headlines
⚙️ UK construction output grows 0.4% in Q1 as March rebounds
ONS figures show overall construction output up 0.4% in Q1 2026 compared with Q4 2025, with a stronger 1.5% month‑on‑month increase recorded in March 2026. This suggests a modest recovery after earlier softness, but momentum remains highly uneven between sectors and regions. For contractors and clients, the data supports cautious optimism on workload pipelines while underlining the need to track segment‑specific demand closely. (Source: ONS)
⚙️ Forecasts split on 2026 outlook as housing drags and infrastructure leads
Government materials commentary and independent forecasts now point to total construction output growth in 2026 ranging from around 1.7% to 2.8%. Both sets of projections agree infrastructure could grow by about 3.9%, while new housing is expected to rebound by up to 4.9% from a weak base, having fallen 6.5% in the three months to February 2026. The divergence in topline views, but consistent strength in infrastructure, will shape bidding strategies and capacity planning for the year ahead. (Source: UK Government)
⚙️ Market size estimates reinforce construction’s macro weight
New industry reports put the size of the UK construction market in 2026 at between USD 325bn and £390bn, highlighting its scale and continued growth despite recent volatility. The ranges reflect differing methodologies but confirm construction’s central role in the wider economy. For investors and lenders, this underpins the sector’s strategic importance even as risk adjusts across sub‑markets. (Sources: Mordor Intelligence; Gleeds)
🏗️ Housing viability and reform pushed to the forefront of delivery debates
Policy and legal briefings now place viability testing at the heart of efforts to deliver the government’s 1.5m homes target, alongside proposals to streamline planning decisions and support regeneration and energy‑efficiency retrofits. Wider regulatory themes – including rent review reform, commonhold, ESG and building safety – are identified as critical to scheme feasibility. For developers and funders, this reinforces that policy risk and regulatory detail are now as material as construction cost inflation in determining which projects move. (Sources: Housebuilder; Ashurst; Farrer & Co)
🚆 Infrastructure pipeline strengthens with £30bn live projects and >5% growth
Returning today as a key theme, Gleeds’ Q1 2026 market report shows non‑residential starts up 6%, driven by utilities and civil engineering, with infrastructure delivering year‑to‑date growth above 5% and a live pipeline of around £30bn. These near‑term figures sit within a longer‑term £725bn 10‑year strategy spanning transport, energy and utilities. The data confirms infrastructure as the sector’s stabiliser, offering visibility for civils contractors and consultants even if other segments remain patchy. (Source: Gleeds)
Also in the news
🚆 Major schemes including HS2, the Lower Thames Crossing, Hinkley Point C, Sizewell C, East West Rail and the Transpennine Route Upgrade continue to progress as flagship elements of the national programme through the early 2030s. (Source: UK Government / public reporting)
🏗️ London‑focused planning measures are being developed to unstick stalled schemes and recalibrate how infrastructure is funded, with implications for viability and phasing on urban regeneration projects. (Source: Ashurst)
🏛️ Legal commentators highlight rent review reform and potential expansion of commonhold as emerging pressures for residential portfolios and build‑to‑rent strategies. (Source: Farrer & Co)
🌱 ESG expectations and tighter building safety standards are flagged as increasingly central to residential and mixed‑use scheme design, procurement and funding decisions. (Source: Housebuilder)
🚆 The UK’s £725bn 10‑year infrastructure strategy, covering transport, energy and utilities, remains the core framework for government investment planning despite a lack of new announcements on 1–2 June. (Source: UK Government)
The Daily Build is written for people shaping the UK’s construction and infrastructure pipeline, from boardrooms to site offices. If this briefing is useful, consider forwarding it to colleagues who are planning bids, investments or capacity for the second half of 2026.