Housing construction growth offsets non-residential dip

Housebuilders have injected confidence in the construction sector, with activity picking up pace in the three months to April, according to data from Glenigan. The firm’s most recent Construction Index reported a 24% quarter-on-quarter surge in residential starts, up by 22% year-on-year, driven by both private and social housing. Performance in non-residential sectors was mixed. Community and amenity project starts showed quarterly growth of 21%, health by 12% and offices by 61%. On a year-on-year basis, the figures increased 19%, 2% and 26%, respectively. On the flip side, retail, and hotel and leisure project starts reported sharp declines of 19% and 26% quarter-on-quarter, respectively, and 33% and 25%, year-on-year. Geographically, the South West led construction performance, growing by 15% on the previous three months and rising by 29% on the same period last year. Project starts were also strong in the South East, increasing by 32% on the preceding quarter and rising by 8% year-on-year. London experienced a 22% increase in activity compared with the previous quarter, though it was still down by 10% on the previous year. Similarly, the West Midlands had more positive quarterly activity, with starts rising by 16% against the preceding three months, but falling by 6% on the same period in 2024. The North West saw an uplift in construction activity, with project starts rising by 25% against the preceding three months. However, it remained 20% behind 2024 figures. In contrast, North East construction starts fell by 4% against the previous quarter but stood up 11% compared with the previous year. Allan Wilen, economics director at Glenigan, said: “Builders were reporting falling workloads at the end of last year, reflecting a period of real uncertainty across the construction sector. However, the latest figures, particularly in residential, suggest fortunes may be starting to turn. “This uptick in activity is encouraging, but sustained recovery will depend on confidence filtering through the supply chain. The government’s much-anticipated Spending Review in June will be a crucial moment. If it brings clarity on major infrastructure investment, it could unlock momentum not just for big-ticket schemes, but the smaller, local projects captured in this data too; the kind councils are waiting to green-light.” Image © Troy Mortier/Unsplash