By Richard Cook, Senior Director of Economics
The Office for National Statistics has released new figures for construction output in Great Britain. Here’s a snapshot of what you need to know.
Construction output is finally moving in the right direction
Total construction output in Great Britain fell by 2.0% in the three months to February 2026, marking the fifth consecutive decline in the three‑month series. Over this period, new work decreased by 3.4%, while repair and maintenance showed no growth (0.0%).
At a sector level, six of the nine construction sectors recorded declines, with private new housing falling by 6.5%, making it the largest negative contributor to the overall movement
However, on a monthly basis, construction output increased by 1.0% in February 2026, following a 0.5% increase in January 2026 and a 1.3% decrease in December 2025. The February increase reflected growth in both main work types, with new work rising by 1.0% and repair and maintenance increasing by 0.9% over the month.
After four consecutive months of falling construction output figures, today’s numbers are a welcome tonic to an industry which has long struggled through mounting headwinds.
The rise could, in part, be due to long-awaited changes to the NPPF, which are set to cut the extensive planning delays which have bogged down the industry for years. With further changes set to be announced in the summer, there’s a chance that things might finally be changing for the better.
Will geopolitical conflict lead to a recession for UK housebuilding?
Naturally, any green shoots will be contending with several crucial economy-wide pressures. The conflict in Iran, for example, will undoubtedly have a drastic effect on the UK economy, which would be passed onto the construction industry. If this leads to a UK recession, housebuilding in particular could face a substantial downturn, which would seriously hurt the Government’s chances of building 300,000 homes a year – a target it is already struggling to hit
Even without a recession, the UK’s barely growing economy has already taken a beating from the ongoing conflict, which will naturally hit the construction industry further. The IMF recently claimed the UK will be the hardest hit by conflict out of any advanced economy globally, downgrading its estimate for UK growth in 2026 to only 0.8%. Put simply, the already dire situation facing the Chancellor has only gotten worse.
While rising construction outputs is a good sign, the Government must understand that past performance is not indicative of future results. Further intervention from the Government is still needed to protect this crucial sector.
How Pegasus Group can help you
Under constrained economic conditions like these, there’s more pressure than ever on viability, especially in light of cautious lender and purchaser behaviour.
This is where our team can help. Pegasus supports developers in protecting scheme viability and momentum through early, evidence-based planning strategies and technical coordination. This includes, among other things, robust site appraisals, flexible masterplanning, and policy-aligned development frameworks that can accommodate phasing, tenure mix changes, or reduced upfront infrastructure burdens.
Our planning teams can also support re-optimisation of schemes to reflect current sales rates and build costs, while providing clear justifications to local authorities for revised layouts, densities, or delivery assumptions.
If you’re looking to de-risk your project, please get in touch with us. We would love to support you.