The impact of the war in the Middle East is weighing heavily on the north’s construction sector, with rising material costs, a tougher credit environment and increased pressure on margins are already leading some developers to slow activity.
The latest Royal Institution of Chartered Surveyors (Rics) construction monitor shows that workloads in Northern Ireland fell in the first quarter of this year and are expected to flatline over the next 12 months, with expectations around housebuilding and profit margins being flat at best.
“The local construction sector has started off the year with challenging market conditions,” says Carolyn Laverty, construction spokesperson for Rics in Northern Ireland.
“Much of this is a continuation of what was seen through 2025, but the geopolitical situation has brought added challenges.
“It is concerning to see that surveyors are cautious on the outlook ahead, particularly when it comes to profit margins.
“The increased cost of raw materials has been a big challenge for construction professionals in recent years, and the current uncertainty appears to be very much weighing on the minds of surveyors as we look ahead.”
All construction sub-sectors in the north saw a decline in activity in the first quarter of the year, with big falls in public and private housebuilding and downturns too in commercial activity, public works and infrastructure.
Some 44% of the Rics survey respondents locally anticipate profit margins to decline – the worst it’s been in two and a half years and also the highest of all UK regions.
Northern Ireland also continues to report skills shortages, notably among bricklayers and quantity surveyors.
