Should I Build a Home in 2026?

The Building Cost Information Service [BCIS], which publishes five-year UK construction forecasts, expects overall building costs to rise by 14% between 2025 and 2030. The main drivers are materials and labour. 

Construction material prices surged in 2022, reaching a 40-year high. While inflation has slowed since then, prices are still climbing, just not as quickly.

UK supply chains are still feeling the effects of the war in Ukraine, post-Brexit trade changes and the lasting impact of the pandemic. Manufacturing costs remain high and many key materials are expected to become more expensive over the next few years.

BCIS predicts material prices will rise by 13% between 2025 and 2030. In 2025, the Federation of Master Builders [FMB] found that 61% of small to medium-sized UK builders had raised their prices, with 75% reporting increased material costs.

What this means for you: if you want price certainty, the builder you choose matters. A clear spec and early decisions make it easier to lock in supplier pricing and avoid unexpected price increases.

Labour costs are rising fast. In 2025, 67% of builders reported higher wages, driven by increases in employers’ National Insurance contributions, the National Living Wage, and a growing skills shortage.

That shortage is already causing delays on UK building sites. In 2025, 61% of builders struggled to hire skilled tradespeople, and 49% reported job delays because they couldn't get the labour they needed. The pressure is likely to increase as the workforce ages: 35% of UK construction workers are over 50, while only 20% are under 30. By 2032, the UK will need nearly one million additional construction workers to keep up with demand.

What this means for you: delays usually come down to people, not plans. A builder with dependable subcontractors, trade partners, realistic programming and a systemised build approach can reduce disruption and protect your move in date.

Another factor likely to affect future build costs is tightening energy performance requirements.

The Scottish Government has signalled that all new homes will soon be expected to meet a "Scottish equivalent" of the Passivhaus standard. Passivhaus is a proven, science based approach to ultra low energy homes, developed over 30 years ago in Germany.

It can reduce heating bills by 79%  compared to current Scottish new builds, while improving comfort, air quality and long term performance.

Passivhaus homes typically cost about 4-8% more than traditional homes due to the need for higher quality materials, components and specialist professionals. However, as the standard gains wider acceptance and Scotland’s supply chain for materials and components expands, costs are expected to decrease. Additionally, the upfront investment is offset over time, as Passivhaus homes have significantly lower running and maintenance costs.

What this means for you: if higher energy standards are coming, it pays to choose a builder who already delivers Passivhaus certified homes. They'll know the details that drive performance and cost, so you avoid paying twice through redesigns, site fixes, or missed targets. That usually means fewer surprises, a smoother build and a home that performs as promised.

In short, unlikely.

With stricter building standards ahead, labour constraints and materials still rising, build costs are not expected to fall. Waiting for prices to drop can be a false economy.

The sooner you commit to a build, the more opportunity your builder has to lock in rates with suppliers and subcontractors, potentially saving you thousands. It also means you could be living in your new home sooner, rather than watching another year pass.

If your priority is a home you’ll be proud of, with a clear budget and a reliable timeline, the smartest move is usually not waiting for the “perfect” moment. It’s choosing the right team and getting a clear plan in place now.