UK residential construction remains in a slump, with the value of started projects 33% lower than the same period last year, according to new data from Glenigan.

The value of started projects fell 8% in the three months to the end of September 2026, the construction experts found.

The figures, published in the October 2026 edition of the Glenigan Construction Index, show weakness continuing across the housing market despite growing government ambitions to increase housebuilding.

The index tracks underlying construction projects valued at £100m or less, unless otherwise stated.

The residential figures underline the gap between the government’s housebuilding ambitions and the number of schemes actually getting under way.

Social housing was particularly weak during the period, with project starts plunging 33% compared with the previous three months and falling 35% year-on-year.

Private housing performed somewhat better, with starts increasing 4% against the preceding three months. However, the improvement came from a low base, with private housing starts still 33% below the level recorded a year earlier.

Overall construction activity also remained subdued. The value of underlying projects starting on site fell 2% against the preceding three months and was 18% below the level seen a year earlier.

Glenigan said tough market conditions, elevated borrowing costs and continued uncertainty over the government’s fiscal position were keeping developers cautious.

The residential sector is now looking to the government’s housing measures and the forthcoming Budget to provide greater certainty and help unlock stalled schemes.

The prime minister has pledged the biggest council housebuilding programme since the post-war era, supported by the £39 billion Social and Affordable Homes Programme.

However, Glenigan’s latest data suggests that these commitments have yet to translate into a significant increase in residential starts.

Glenigan economics director Allan Willen said private housing starts had stabilised over the latest three months but remained sharply below the previous year.

“A welcome surge in civil engineering projects partially offset a decline in residential and non-residential project starts during the last three months,” he said.

“While private housing starts stabilised against the previous three months, they remained sharply down on a year earlier.

“The new first-time buyer scheme announced by the prime minister will hopefully help to rebuild market confidence and support a recovery in private housebuilding over the coming months,” he said.

He added that a Budget providing greater certainty for developers could help get stalled schemes moving.