Serbia’s construction sector recorded contrasting trends in the second quarter of 2026, as building activity expanded sharply while civil engineering output contracted, limiting growth across the industry during the first half of the year. The value of construction works performed on Serbian territory increased by 9% in real terms year-on-year in the second quarter, driven by a 32.4% rise in building works. In contrast, civil engineering activity fell by 7.1%.
Building Works Outpace Civil Engineering
The gap between the two segments widened over the first six months. Building works performed by Serbian contractors increased by 22.6% in real terms, while civil engineering works declined by 14.1%. As a result, total real construction growth reached just 0.2% over the first half of 2026.
The figures point to an uneven performance across the sector, with building development recording substantial growth while infrastructure-related construction continued to weaken. Activity was therefore not distributed evenly across residential, commercial and public infrastructure projects.
Regional Construction Trends Diverge
Construction output also varied considerably across Serbia’s regions in the second quarter. Belgrade recorded a 51% real increase in construction activity, while Southern and Eastern Serbia experienced a 32.3% contraction.
In Šumadija and Western Serbia, construction activity declined by 27.5% in real terms over the same period, highlighting the substantial regional differences in the sector’s performance.
Implications for Developers and Contractors
The divergence between building development and civil engineering is relevant to investors and contractors because the two segments have different financing structures, project cycles and risk exposures. Property developers may benefit from the stronger volume of building activity, while infrastructure contractors face greater uncertainty over execution schedules and workloads. The expansion in building works also supports activity in construction materials, installation and engineering markets. The decline in civil engineering output and the limited 0.2% overall real growth in the first half indicate that the sector’s performance remains heavily dependent on the building segment.
