Eurocell presents its assessment of the UK new build landscape as we move into 2026, following another year defined by economic pressure, complex regulation and an absence of policy certainty.

Early 2025 saw housebuilders navigating multiple overlapping challenges. High interest rates suppressed buyer demand, while material price inflation, energy costs and persistent labour shortages added significant pressure to project viability. While some of these challenges have ‘eased’, there is still some way to go. 

Many developers entered the year with cautious optimism and an expectation that activity would lift in the second half of 2025. According to Eurocell’s Head of New Build, Martin Benn, that recovery failed to materialise due to a combination of subdued consumer confidence, persistent cost pressures and ongoing delays within the planning system. Together, these factors created a tougher-than-expected operating environment and held back the anticipated uplift in activity.

Benn explained: “Affordability remains the biggest barrier. Without intervention to stimulate demand, and with borrowing still expensive for both buyers and developers, we’ve seen momentum stall. The appetite is there, but the conditions simply haven’t aligned.”

Regulation: the sector’s biggest unknown

Regulation has been another major source of uncertainty. The 2021 uplift to Approved Document L (ADL) required a 31 to 35% reduction in CO2 emissions compared with previous standards, increasing build costs through additional fabric measures, higher-performing windows, improved airtightness, PV arrays and mechanical ventilation.

ADL 2025 is expected to form part of the upcoming Future Homes Standard, which targets a 75 to 80% reduction in whole-house emissions. While full details are still to be confirmed, the shift is set to significantly tighten performance requirements and reshape specification choices across the sector.

However, the delayed publication of ADL 2025 has left housebuilders unable to plan specifications, pricing or product choices with confidence.

Benn commented: “Developers are effectively planning blind. Multiple parts of the building regulations, L, F, O, B and M, don’t currently harmonise, and consultation documents have lacked detail. Uncertainty slows delivery, increases cost, and introduces risk into every step of the process.”

Eurocell anticipates a period of rapid technical recalculation once ADL 2025 is released, as housebuilders push for marginal gains on U-values and performance criteria to achieve compliance. It expects technical teams across the country to play an increasingly crucial role in helping developers shape commercially viable specifications under the new rules.

Building safety and sustainability: the shift continues

Alongside energy performance, the Building Safety Act continued to reshape responsibilities and liabilities throughout 2025, particularly in mid- and high-rise projects. Benn notes that the additional accountability introduced by the Act has already begun to shift the market: “We’re seeing more scrutiny, more documentation, and a higher bar for product evidence. For some suppliers, that burden may prove too heavy. For others, it’s an opportunity to demonstrate robustness and technical credibility.”

Sustainability is also evolving rapidly. The growing adoption of Environmental Product Declarations (EPDs) is introducing new transparency into materials, giving recycled content and embodied carbon measurable, tradeable value. Eurocell expects sustainability data to become a core part of specification decisions in 2026 and beyond.

Looking ahead: opportunities for 2026

Despite the headwinds of 2025, Eurocell sees reasons for cautious optimism heading into 2026. Greater regulatory clarity, once delivered, is expected to unlock delayed projects and allow developers to move forward with confidence. Sector outlooks indicate a stabilising economic picture and increased focus on high-performance materials could also create new opportunities for manufacturers.

Benn concluded: “The industry is resilient. What housebuilders need now is certainty - clear regulation, stable policy and practical guidance. Once that arrives, the sector will move quickly. Our focus at Eurocell is on supporting that transition with the right technical expertise, product development and data to help our customers meet the next stage of change.”