The Builders Merchants Federation (BMF) has released its Winter 2025 industry forecast, which predicts a fairly bleak start to the year
The BMF industry forecast states that the stagnant building material market will continue into 2026. The forecast uses the BMF’s market analysis throughout 2025.
Growth prediction fell by more than 1%
Originally, the BMF’s summer report predicted a growth of 2.5% in 2026; however, after a heavy downturn in Q3 2025, the predicted figure was revised to 1.4%.
Along with indicators from GfK’s Consumer Confidence Barometer, S&P Global’s Purchasing Managers Index, Consumer Price Inflation, Gross Domestic Product, unemployment, and pay data, and data from the Bank of England, the BMF have crafted a picture of continued stagnation until the second half of 2026 at the earliest.
John Newcomb, CEO of the BMF, said: “Initially, we saw a glimmer of growth in building material sales in the first six months of 2025, but the positive trend stalled and the anticipated turnaround for the third quarter of the year failed to materialise.
“Instead Q3 was heavily impacted by economic shocks, with a sharp contraction in August despite the hottest summer on record.
“This was compounded by housebuilders adopting a cautious approach ahead of the Autumn Budget, which ultimately fell short of delivering the stimulus required to reignite the housing market, as well as a fall in consumer confidence.
“Looking at the year ahead, customer confidence still remains fragile.
“There’s a significant gap between what the Government has proposed and what is being achieved out on the ground.
“A jumpstart is needed to get the building sector moving and without Government intervention it is going to be difficult to move forwards.
“We need to see activity including incentives for first-time buyers, delivery of the Social and Affordable Housing Programme and more action to free up brownfield land, as well as the publication of the long-awaited Warm Homes Plan and the Future Homes Standard.”
Government needs to create the right conditions for the industry to deliver
Writing for PBC Today in October, Eve Livett (CEO of the Masonry Association of Great Britain) shared what she would have liked to have seen in the Autumn Budget, delivered in November last year, and into 2026.
Eve wrote: “As the Autumn Budget approaches, I’ve been thinking a lot about what the construction industry really needs to keep moving forward. For all the talk about growth, skills and sustainability, the reality is that our sector is ready and willing to deliver. We just need the government to create the right conditions for it to happen.”
She continued: “One of the biggest frustrations we face is the way the current VAT system actively discourages essential work like retrofit and energy efficiency improvements. That has to change. If we’re serious about tackling energy use and carbon emissions, we should be encouraging people to improve the buildings we already have, not making it more expensive. A simple VAT relief on retrofit projects would be a huge step forward, boosting work for small builders, improving housing stock and helping households cut their bills.”
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