The final quarter of 2024 presented challenges for the UK construction and housebuilding sectors, but it also highlighted opportunities for growth and transformation. UK construction output data from the ONS shows a rise of +0.5% in Q4 2024 from Q3 2024, driven by a +1.2% increase in new work, despite a -0.4% drop in repair and maintenance. Over the year, construction output grew +0.4% from 2023, marking the fourth consecutive year of growth. This was largely due to an +8.5% increase in repair and maintenance, though new construction projects fell -5.3%. 2024 also saw a -7% decline in home completions (recorded by the NHBC), highlighting the need to tackle critical challenges and build a stronger industry. High borrowing costs and financial pressures tested developers but also inspired innovative solutions to sustain progress.

The Federation of Small Businesses (FSB) has stepped forward with a call for a dedicated Small Housebuilder Strategy, aiming to stabilise the market and support smaller developers. This presents a chance to empower businesses, especially with the government’s £100 million boost for local authority development plans—a move that signals positive momentum. Clarifying policies on “grey belt” land and housing needs will further strengthen the industry’s foundation and open new doors for development.

The Future Homes Standard (FHS) is a promising step toward a greener future, offering both challenges and opportunities. While awareness of the FHS among builders is still growing (fewer than 25% of builders are aware of FHS), this creates an opportunity to educate and upskill the workforce in low-carbon construction techniques, like solar roof and heat pump installation, and prepare for the government’s 2035 gas boiler phase-out. Clear communication and guidance will be central to achieving these goals and embracing the benefits of sustainable construction. Broader industry issues, such as grid capacity limitations and labour shortages, also bring opportunities for innovation and collaboration. By investing in workforce training, expanding expertise in eco-friendly technologies, and educating homeowners, the construction sector can accelerate progress toward net-zero targets while creating new jobs and fostering public awareness of sustainable living.

Looking ahead, there’s plenty of reason to feel optimistic. The Construction Products Association forecasts growth of 2.1% in 2025 and 4% in 2026, across the whole construction sector, fuelled by energy-efficiency projects and infrastructure development. By addressing current challenges, simplifying planning processes, and embracing the FHS, the industry is well-positioned to unlock long-term growth. Collaboration between policymakers, developers, and industry experts will be key to turning these opportunities into reality, ensuring a more sustainable and prosperous future for the UK construction sector.