Residential construction rises 12.6% as commercial building output falls 18%
Irish construction activity edged up 0.4% in Q2 as stronger residential and civil engineering work offset a 9.7% quarterly fall in non-residential building
27 August 2026 | editor@breakingground.news
The volume of residential construction activity in Ireland increased by 12.6% in the year to the second quarter of 2026, contrasting sharply with an 18% fall in non-residential building activity, new Central Statistics Office data shows.
The CSO’s latest Production in Building and Construction Index shows that overall construction volumes increased by just 0.4% between the first and second quarters of 2026 on a seasonally adjusted basis.
Despite the quarterly improvement, total construction production remained 3.4% below its level in Q2 2025.
Residential building was the strongest-performing part of the industry. Production volumes increased by 5.5% quarter-on-quarter and were 12.6% higher than a year earlier.
The residential measure is broader than new housing construction alone. It captures surveyed construction activity relating to both new and existing residential buildings, including repairs, improvements, retrofitting, solar panel installations and extensions.
The CSO has cautioned against directly comparing the index with its New Dwelling Completions statistics. Construction work on a home can take place over several months, while a dwelling is recorded as completed under the completions series when it is connected to the ESB electricity network.
Civil engineering activity also strengthened during the latest quarter, with production volumes increasing by 3.1% from Q1. However, civil engineering output remained 4.4% lower than in Q2 2025.
The largest contraction was recorded in non-residential construction. Production volumes fell by 9.7% in just three months and were 18% below their Q2 2025 level.
The figures point to an increasingly divergent construction market, with growth in residential activity being offset by weaker commercial and other non-residential building work.
Across the industry as a whole, the seasonally adjusted volume index stood at 106.7 in Q2 2026, based on 2021 equalling 100. This was up from 106.3 in Q1 but down from 110.4 in Q2 last year.
The value of construction production performed more strongly than its underlying volume. The seasonally adjusted value index increased by 1.1% during Q2, from 129.5 to 130.9, although it remained 0.6% below the 131.7 recorded a year earlier.
Excluding civil engineering, the value of building production fell by 0.2% quarter-on-quarter and by 1.1% annually.
The difference between construction values and volumes comes against a backdrop of higher costs. The CSO said the deflator used to calculate the Production in Building and Construction Index was 3.1% higher in Q2 2026 than a year earlier.
Shane O’Sullivan, Statistician in the CSO’s Housing Division, said: “On a seasonally adjusted basis the volume of production in Building and Construction rose by 0.4% between Q1 2026 and Q2 2026. On an annual basis, production volume decreased by 3.4%.”
The Q2 figures are provisional and based on early returns from respondents, while the Q1 2026 figures have now been finalised.
