Market forecast: Industry steadies, but high input costs show no signs of easing

By Pablo Cristi Worm 2026-03-10T06:00:00

Despite a challenging final quarter, the UK construction industry remained resilient in 2025, and a sense of cautious optimism emerged at the start of the year

01 / Summary

Tender price index ▲

Tender prices are forecast to increase by 3.8% this year, before stabilising at an annual rate of 4.0% in 2027 and 2028 as pent-up demand returns to the market.

Building cost index ▲

Building costs are increasing in line with the long-term average, rising by 3.4% by the end of 2025, aided by easing labour costs.

Consumer prices index ▲

The consumer price index (CPI) rose by 3.0% in the 12 months to January 2026, down from 3.4% in December, with transport, food and non-alcoholic beverages making the largest downward contributions.

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