BBVA sees Mexican construction rebound

Mexico’s construction industry shrank 1.0% in 2025, and BBVA now says it should return to growth in 2026 instead of staying stuck in reverse. The bank ties that turn to more homebuilding and a bigger federal push on public works. (jornada.com.mx) (bbvaresearch.com) The slump was not a broad collapse across every kind of building. BBVA says the main drag was civil works, which fell 22.5% in 2025, while building construction still grew 4.3%, so the problem was highways, rail, energy and other big works more than apartments or houses. (holanews.com) (bbvaresearch.com) That split tracks the budget. BBVA’s earlier research said public-works resources were cut 12.6% in real terms versus 2024, and that cut hit the part of construction that depends most directly on government contracts. (bbvaresearch.com) (bbva.com) Now the pendulum is swinging back. BBVA’s new 2026 real-estate outlook says the increase in the 2026 budget for public works should lift the sector, and a Mexican budget analysis group estimated public investment at 1.26 trillion pesos in the 2026 budget, up 21% in real terms from 2025. (bbvaresearch.com) (ciep.mx) Housing is the other leg of the rebound. BBVA says private building has stayed solid for 11 straight quarters, and its 2026 report says housing growth is concentrated in Mexico’s biggest metropolitan areas, where financing and demand are deepest. (bbvaresearch.com 1) (bbvaresearch.com 2) There is still a catch inside the housing story. BBVA says the mortgage market contracted by 0.5% in number of loans and 2.9% in total amount disbursed, so the rebound it sees for construction is coming even with credit still soft, which means more of the near-term lift has to come from targeted projects and public spending. (bbvaresearch.com 1) (bbvaresearch.com 2) The upside case is bigger than houses and routine public works. BBVA chief economist Carlos Serrano said growth could run faster if the federal government’s recently announced infrastructure plans move quickly, especially in energy. (jornada.com.mx) (strategicenergy.eu) Those plans are not small on paper. Mexico’s 2026–2030 infrastructure plan projects 5.6 trillion pesos in total investment, with 722 billion pesos for 2026 on top of 900 billion pesos already budgeted for energy, railways, highways, ports, health, water and education. (mexicobusiness.news) (news.griinstitute.org) For builders in the United States and Canada, this does not look like labor relief arriving from the south. North American construction is still short of skilled workers, and Associated Builders and Contractors says the United States alone needs 349,000 net new workers in 2026 and 456,000 in 2027 to keep up with demand. (abc.org) (constructiondive.com) So the BBVA call is less about a boom than about traffic starting to move again after a lane closure. Mexico’s 2025 weakness came from a sharp pullback in big public works, and its 2026 recovery depends on whether housing momentum holds and whether the government can turn announced infrastructure into crews, contracts and poured concrete. (jornada.com.mx) (bbvaresearch.com)