The UK construction sector continues to face significant pressure despite signs of a short-term recovery, according to Glenigan’s latest Construction Review.

Project starts increased by 22% during the three months to April 2026 compared with the previous quarter, while main contract awards rose 29% and detailed planning approvals increased 8%. However, the longer-term picture remains considerably weaker.

Compared with the same period last year, detailed planning approvals fell 54%, project starts declined 17% and contract awards slipped 11%, highlighting ongoing challenges across the sector.

Glenigan said elevated borrowing costs, viability pressures and cautious investor sentiment continue to weigh heavily on development activity despite isolated areas of resilience.

The residential sector remained relatively stable, with project starts falling just 2% year-on-year, while social housing activity surged 236%. However, private housing and apartment developments weakened sharply, falling 45% and 56% respectively.

Office construction was one of the strongest-performing sectors, with project starts rising 217% year-on-year, driven by a sharp increase in major schemes valued above £100m.

Allan Wilen, Economic Director at Glenigan, said: “Whilst this encouraging uptick will come as some relief after months of decline, the sector must not risk falling into a fool’s paradise.”

The report suggests that while selective growth opportunities remain, wider economic uncertainty and constrained investment continue to limit confidence across large parts of the construction sector.