Housing drags down fledgling construction recovery

The bellwether S&P International UK Building Buying Managers’ Index (PMI) registered 44.5 in February – down from January’s seven-month excessive (46.4) and the 14th consecutive month-to-month fall.

Residential constructing remained the weakest-performing phase in February (index at 37.0) and the speed of decline accelerated since January.

Industrial development exercise (46.5)additionally decreased at a quicker tempo than initially of the yr, however the pace of the downturn was a lot much less marked than seen throughout the remainder of the development sector.

Civil engineering was the one sub-sector to document a slower fall in exercise ranges throughout February. Though nonetheless sharp, the newest index studying (41.0) pointed to the slowest price of contraction since September 2025.

On a brighter notice enterprise exercise expectations improved to the very best since December 2024. Round 42% of the survey panel forecast an increase in output ranges throughout the yr forward, whereas solely 12% anticipate a decline.

Building corporations once more confronted stress on their margins from sharply rising enter prices. February information signalled the steepest rise in common price burdens since July 2025.

Many corporations famous greater costs paid for objects akin to concrete, copper, insulation and metal.

Tim Moore, Economics Director at S&P International Market Intelligence, stated: “A sharper downturn in home constructing was the primary issue behind the setback for UK development exercise in February, following some indicators of stabilisation at the beginning of 2026.

“Whole trade exercise has decreased in every month since January 2025 and the newest decline was quicker than seen on common over this era. The discount in output was largely as a consequence of sluggish demand situations, however some corporations additionally famous that exceptionally moist climate had disrupted development initiatives.

“Building corporations had been hopeful of a turnaround in enterprise exercise over the yr forward, with optimism ranges hitting a 14-month excessive in February. This was usually linked to forthcoming new initiatives within the infrastructure and power sectors, in addition to projected enhancements in broader financial situations.

“Sharply rising enter prices had been a problem in February. The speed of buying worth inflation hit a seven-month excessive as suppliers handed on rising uncooked materials prices,particularly metals.”