Construction Loans Tracker: US Bank Construction and Land Development Lending, Q2 2026

This month in brief

• US FDIC-insured institutions held $453.5 billion in construction and development loans on June 30, 2026, down 3.4% from $469.2 billion a year earlier (FDIC QBP).
• The balance was flat in Q2 2026 (+$155 million) after 9 consecutive quarterly declines from 2024 Q1 to 2026 Q1.
• C&D loans are 28.2% below their 2008 Q1 peak of $631.8 billion in nominal terms and 63.9% below in construction-price-adjusted terms (BLS office building PPI).
• Construction lending fell to 3.25% of all bank loans in Q2 2026, from 7.93% in 2008 Q1.
• The C&D noncurrent rate rose to 0.99% in Q2 2026 and passed the all-loans rate (0.93%) for the first time since 2014 Q4; losses stay low at 0.12% year to date.
• In the Fed's July 2026 survey, banks on net eased construction and land development standards (-3.7) for the first time since January 2022, while demand weakened (-11.1).
• Weekly Fed H.8 data show commercial bank C&D loans rising 2.0% from June 2026 to the week ending September 23, 2026.

Construction loans in Q2 2026: the latest bank reading

Bank construction lending stopped shrinking in the second quarter of 2026 but did not grow. The balance is 3.4% below a year earlier and credit quality slipped slightly.

FDIC-insured institutions held $453.5 billion in construction and development loans on June 30, 2026, according to the FDIC Quarterly Banking Profile for Q2 2026. That is $155 million more than on March 31, 2026, a change of 0.03%, and 3.4% less than the $469.2 billion held on June 30, 2025.

The flat second quarter ended a run of 9 consecutive quarterly declines that began in 2024 Q1, measured in the CB&C quarterly series built from the FDIC BankFind Suite API. Over the same 12 months total loans and leases at insured institutions grew, so construction loans fell to 3.25% of all bank loans in Q2 2026 from 3.6% in Q2 2025.

Construction and land development (C&D) loan: The FDIC defines construction and development loans as loans for all property types under construction, plus loans for land acquisition and development (QBP Notes to Users). The category mixes commercial buildings, multifamily, single-family homes and land. In bank Call Reports the field is LNRECONS.

These are balances outstanding, not new loans. A flat balance can hide new draws on active projects offset by loans that were repaid or converted to permanent financing when buildings were finished. For construction activity itself, see the CB&C commercial construction spending tracker.

Bank construction lending since 2007: the collapse and the partial rebuild

C&D lending fell by more than two thirds after 2008, rebuilt for a decade, and has been easing back since late 2023. Adjusted for building prices it is far below the 2008 level.

C&D loans peaked at $631.8 billion in 2008 Q1. By 2013 Q1 they had fallen 68.1% to $201.6 billion as projects failed, loans were charged off and banks closed. The balance then rose 148.3% to $500.4 billion in 2023 Q4, the post-crisis high, and has since declined 9.4%.

In nominal dollars the Q2 2026 balance is 28.2% below the 2008 peak, a gap of $178.3 billion. Construction prices rose a lot in between: the BLS producer price index for new office building construction rose 98.8% from Q1 2008 to Q2 2026. Deflated by that index, Q2 2026 C&D loans equal $228.1 billion in Q1 2008 building prices, 63.9% below the peak in real terms.

The fall was concentrated in housing. One to four family residential construction loans dropped from $203.8 billion in 2008 Q1 to $91.3 billion in Q2 2026, down 55.2%. Other construction and land loans, which include commercial, multifamily and land development, fell 15.4% to $362.1 billion. The residential share of C&D loans fell from 32.3% to 20.1%.

As a share of bank balance sheets, construction lending is less than half its 2008 weight: 3.25% of total loans in Q2 2026 against 7.93% in 2008 Q1, a drop of 4.68 percentage points. Total loans and leases grew 74.9% over the same period while C&D loans shrank.

Construction loan credit quality: noncurrent and charge-off rates

Problem construction loans are rising from a low base. The C&D noncurrent rate passed the all-loans rate in Q2 2026 for the first time since 2014, though both remain far below crisis levels.

Noncurrent loans are those 90 or more days past due or on nonaccrual status (FDIC). On June 30, 2026, 0.99% of C&D loans were noncurrent, against 0.93% of all loans and leases, per QBP Table V-A. The spread of 0.06 percentage points is small, but the C&D rate had been below the all-loans rate every quarter from 2015 Q1 through 2026 Q1.

Noncurrent C&D balances rose 14.4% in a year, to $4,501.8 million in Q2 2026 from $3,934.0 million in Q2 2025. The C&D noncurrent rate has risen from 0.50% in 2023 Q4 to 0.99%. For scale, it peaked at 16.83% in 2010 Q1.

Losses remain low. C&D net charge-offs were 0.12% of C&D loans, year to date annualized, in the first half of 2026, against 0.58% for all loans (QBP). In the CB&C quarterly series, annualized C&D net charge-offs were 0.11% in Q2 2026; the series high was 8.29% in 2009 Q4. Another 0.35% of C&D loans were 30 to 89 days past due on June 30, 2026, and foreclosed property from construction loans totaled $679.2 million.

Other commercial real estate categories show similar levels. Nonfarm nonresidential loans had a noncurrent rate of 1.23% and multifamily loans 1.10% on June 30, 2026 (QBP Table V-A).

Interagency CRE concentration screens (2006): Federal bank regulators flag a bank for closer review when construction, land development and other land loans reach 100 percent or more of total capital, or when total commercial real estate loans reach 300 percent or more of total capital and the CRE portfolio grew 50 percent or more over the prior 36 months (interagency guidance). The guidance says these are screening criteria, not limits.

Using the FDIC ratio of C&D loans to tier 1 capital (field LNCDT1R) as a proxy, 344 of 4,238 insured institutions, or 8.1%, held C&D loans at or above 100% of tier 1 capital in Q2 2026, down from 376 of 4,421 (8.5%) a year earlier. The guidance uses total capital, which is larger than tier 1, so this count likely overstates the number of banks over the 100 percent screen.

Lending standards and demand for construction loans: the Fed survey

Banks stopped tightening construction loan standards in mid-2026, after three years of net tightening, but say demand is still weakening and standards remain tight relative to their history.

In the July 2026 Senior Loan Officer Opinion Survey, released August 3, 2026, the Federal Reserve reported that standards for construction and land development (CLD) loans 'remained basically unchanged on net' in Q2 2026. The net percentage of domestic banks tightening was -3.7, a small net easing. Of 54 banks answering, 5.6% tightened somewhat, 85.2% left standards unchanged and 9.3% eased somewhat.

This is the first net easing reading since the January 2022 survey (-10.3). Net tightening reached 73.8% in the April 2023 survey and was still 9.7% in July 2025. The series high since it began in October 2013 is 80.9%, in the July 2020 survey.

Large banks (domestic assets of $100 billion or more) eased on net, at -15.0, while other banks tightened slightly on net, at 2.9. Demand weakened: the net share reporting stronger demand was -11.1, with 25.9% of respondents reporting weaker demand and 14.9% stronger.

A special question in the same survey asked where standards sit relative to their range since 2005. For CLD loans, 47.2% of banks put their standards on the tighter side of the midpoint and 17.0% on the easier side, a net 30.2% at the tighter end. The Fed noted this net share was lower than in July 2025.

State view: construction loans by bank headquarters state

Ten headquarters states hold just over half of US bank construction loans, but the state view measures where banks are chartered, not where buildings go up.

Banks headquartered in Ohio held $49.2 billion in C&D loans in Q2 2026, 10.85% of the US total, followed by Texas ($35.6 billion), North Carolina ($29.1 billion), South Dakota ($22.4 billion) and Arkansas ($20.0 billion). The top 10 headquarters states held 53.4% of all C&D loans.

Year-over-year changes by state can reflect mergers and charter moves as much as lending. Texas-headquartered banks reported 13.8% less C&D lending in Q2 2026 than in Q2 2025; Comerica Bank, headquartered in Texas, reported $3.7 billion in C&D loans in Q2 2025 and did not file a separate report for Q2 2026. Ohio-headquartered banks reported 21.1% more.

Per resident, C&D loans across all insured institutions equal $1,327 per US resident. Headquarters effects dominate the state ranking: South Dakota ($23,981 per resident) and Delaware ($14,326) lead,. California is at $347; a low value does not mean little construction lending happens in a state, only that less of it is booked by banks headquartered there.

For a state view of where public construction money goes, see federal construction contracts by state.

Construction loan interest rates: what official data exists

No federal agency publishes an average interest rate for commercial construction loans. The closest public benchmarks are the bank prime rate and a builder survey for residential projects.

Construction loans are usually priced as a spread over a base rate. The bank prime loan rate, posted by a majority of the top 25 insured US-chartered commercial banks, was 7.00% in the week ending October 1, 2026 (Fed H.15). Lenders set the spread deal by deal; the Fed and FDIC do not publish it for construction loans.

For residential construction, the NAHB AD&C Financing Survey reported average contract rates of 7.28% on speculative single-family construction loans and 7.01% on pre-sold single-family construction loans in Q2 2026. Including initial points, average effective rates were 11.82% and 11.67%. Effective rates were 10.43% on land acquisition loans and 12.59% on land development loans. These are builder-reported averages for residential projects and should not be read as commercial construction loan pricing.

Rising building prices also raise the loan amount a project needs. See the CB&C commercial construction price index for what contractors pay and charge.

When this tracker updates next

Three public releases drive this tracker: the FDIC Quarterly Banking Profile, the Fed's Senior Loan Officer Survey and the Fed's weekly H.8 release.

• FDIC Quarterly Banking Profile for Q3 2026: the FDIC publishes the QBP about 55 days after quarter end, around late November; the Q2 2026 edition was released August 25, 2026.
• Fed Senior Loan Officer Opinion Survey, October 2026 round: the Fed times the survey so results are available for the October/November FOMC meeting; it had not posted an exact release date on its SLOOS page as of October 4, 2026.
• Fed H.8 bank assets and liabilities: released weekly, with Wednesday levels. The October 2, 2026 release is used here.

The weekly H.8 data give an early read on Q3 2026. C&D loans at all US commercial banks, seasonally adjusted, rose 2.0% from $449.1 billion in June 2026 to $458.2 billion in the week ending September 23, 2026, though the August 2026 level of $456.1 billion was still 0.8% below August 2025 (Fed H.8). Small domestically chartered banks held $308.6 billion of the $433.2 billion at domestic commercial banks, 71.2%.

Momentum and share analysis

Download the calculations (CSV)

Findings to track

1. FDIC-insured institutions held $453.5 billion in construction and development loans on June 30, 2026 (United States).^[1]
2. US C&D loans fell 3.4% from Q2 2025 to Q2 2026, while the Q2 2026 quarterly change was +$155 million, or 0.03%.^[1]
3. Q2 2026 broke a run of 9 consecutive quarterly declines in US C&D loans that started in 2024 Q1.^[2]
4. US C&D loans in Q2 2026 were 28.2% below the 2008 Q1 peak of $631.8 billion in nominal terms.^[2]
5. Deflated by the BLS PPI for new office building construction, which rose 98.8% from Q1 2008 to Q2 2026, US C&D loans are 63.9% below the 2008 Q1 peak.^[2][14]
6. US C&D loans fell 68.1% from 2008 Q1 to 2013 Q1, to $201.6 billion, then rose 148.3% to $500.4 billion in 2023 Q4.^[2]
7. One to four family residential construction loans fell 55.2% from 2008 Q1 to Q2 2026, against 15.4% for other construction and land loans (United States).^[2]
8. C&D loans were 3.25% of total US bank loans and leases in Q2 2026, down from 7.93% in 2008 Q1.^[2]
9. The US C&D noncurrent rate was 0.99% on June 30, 2026, above the 0.93% all-loans rate for the first time since 2014 Q4.^[1][2]
10. US noncurrent C&D loans rose 14.4% in a year, to $4,501.8 million in Q2 2026.^[2]
11. US C&D net charge-offs were 0.12% annualized in the first half of 2026, against 0.58% for all loans.^[1]
12. In the July 2026 Fed survey, the net share of US banks tightening construction and land development standards was -3.7, down from 73.8 in April 2023.^[9]
13. In the July 2026 Fed survey, a net 30.2% of US banks said construction and land development standards were tighter than the midpoint of their range since 2005.^[8]
14. Banks headquartered in 10 states held 53.4% of US C&D loans in Q2 2026; Ohio-headquartered banks held $49.2 billion.^[2]

Frequently asked questions

Methodology

Source selection: the tracker uses primary federal data only for its measurements: FDIC Call Report data through the Quarterly Banking Profile and the BankFind Suite API, the Federal Reserve Senior Loan Officer Opinion Survey, the Fed H.8 and H.15 releases, BLS producer price indexes and Census population estimates. Trade association material (NAHB) is used for residential context and labeled as builder-reported. Lender marketing pages and rate roundups were excluded.

FDIC aggregation: CB&C summed the BankFind Suite financials fields LNRECONS (construction and land development loans), LNRECNFM and LNRECNOT (1-4 family and other construction), LNLSGR (total loans and leases), NCRECONS and NCLNLS (noncurrent), NTRECONQ and NTLNLSQ (quarterly net charge-offs) and P3RECONS (30-89 days past due) across all filers for each quarter from 2007 Q1 to 2026 Q2, excluding insured branches of foreign banks (BKCLASS OI) and noninsured filers (BKCLASS NC). This scope reproduces QBP Table II-A exactly for Q2 2025 and Q2 2026 ($469,190 million and $453,458 million). Dollar values are in thousands in the API and are shown in billions or millions here.

Ratios: noncurrent rates divide noncurrent balances by end-of-quarter balances. Net charge-off rates are quarterly net charge-offs times 4 divided by end-of-quarter balances; the QBP uses average balances and year-to-date figures, so the QBP value (0.12%) is cited where available and the CB&C series (0.11%) is labeled as such.

SLOOS: net percentages come from the Fed's SLOOS data file (series SUBLPDRCSC and SUBLPDRCDC for all, large and other domestic banks). The data file dates each survey at the end of the quarter in which it is conducted (for example 2026-09-30 = July 2026 survey), and each survey covers the previous quarter. The July 2026 values were checked against Table 1 bank counts.

Real terms: the Q2 2026 and Q1 2008 balances were deflated with quarterly averages of the BLS PPI for new office building construction (PCU236223236223, not seasonally adjusted; May and June 2026 preliminary). The warehouse (PCU236221236221) and school (PCU236222236222) indexes were used as sensitivity checks. The all-nonresidential building index WPU801 starts in 2009, so it cannot reach the 2008 peak.

State view: FDIC filers were grouped by the state of their main office (STALP). Per-resident values divide by Census Vintage 2025 state population. Concentration counts use the FDIC ratio LNCDT1R (C&D to tier 1 capital) as a proxy for the guidance's total-capital screen.

Conflicts: the FDIC total (all insured institutions, including savings institutions) differs from the Fed H.8 total (commercial banks plus foreign-related institutions, seasonally adjusted). Both are reported with their scope; neither is substituted for the other. NAHB's Q4 2024 total ($484.2 billion) differs from the CB&C aggregation ($484.4 billion), likely because of later Call Report amendments.

Limitations: balances are stocks, not originations; nonbank and private credit construction lenders are not covered; headquarters state is not project location; recent quarters can be amended. Last updated 2026-10-04.

This report presents published data with its limitations. It is not legal, financial or investment advice.

Sources, ranked by quality

Tier 1: primary and official sources (17)

• [1] Federal Deposit Insurance Corporation. Quarterly Banking Profile, Second Quarter 2026. Q2 2026 (released 2026-08-25). Accessed 2026-10-04.
• [2] Federal Deposit Insurance Corporation. BankFind Suite API, financials endpoint (all FDIC-insured institutions, aggregated by CB&C). Q1 2007 to Q2 2026. Accessed 2026-10-04.
• [3] Federal Deposit Insurance Corporation. BankFind Suite financial data dictionary (risview_properties.yaml). Field definitions. Accessed 2026-10-04.
• [4] Federal Deposit Insurance Corporation. Quarterly Banking Profile landing page (publication timing). Last updated 2026-08-25. Accessed 2026-10-04.
• [5] Federal Deposit Insurance Corporation. Quarterly Banking Profile Q2 2026: statement on results with accompanying charts. Q2 2026. Accessed 2026-10-04.
• [6] Federal Deposit Insurance Corporation. Quarterly Banking Profile Notes to Users, Second Quarter 2026. Q2 2026. Accessed 2026-10-04.
• [7] Board of Governors of the Federal Reserve System. The July 2026 Senior Loan Officer Opinion Survey on Bank Lending Practices. Q2 2026 (released 2026-08-03). Accessed 2026-10-04.
• [8] Board of Governors of the Federal Reserve System. SLOOS July 2026, Table 1: domestic banks' responses. Q2 2026. Accessed 2026-10-04.
• [9] Board of Governors of the Federal Reserve System. SLOOS data file (FRB_SLOOS_xml.zip), series SUBLPDRCSC and SUBLPDRCDC. October 2013 to July 2026 surveys. Accessed 2026-10-04.
• [10] Board of Governors of the Federal Reserve System. Senior Loan Officer Opinion Survey: release schedule and survey description. Last updated 2026-08-03. Accessed 2026-10-04.
• [11] Board of Governors of the Federal Reserve System. H.8 Assets and Liabilities of Commercial Banks in the United States, October 2, 2026. August 2025 to week ending 2026-09-23. Accessed 2026-10-04.
• [12] Board of Governors of the Federal Reserve System, FDIC, OCC. Interagency Guidance on Concentrations in Commercial Real Estate Lending, Sound Risk Management Practices (SR 07-1, Attachment 2). Issued December 2006. Accessed 2026-10-04.
• [13] Federal Deposit Insurance Corporation. FIL-104-2006: Commercial Real Estate Lending Joint Guidance. December 12, 2006. Accessed 2026-10-04.
• [14] U.S. Bureau of Labor Statistics. Producer Price Index industry data, construction (pc.data.75.Construction). January 2008 to August 2026. Accessed 2026-10-04.
• [15] U.S. Bureau of Labor Statistics. Producer Price Index industry series catalog (pc.series). Series metadata. Accessed 2026-10-04.
• [16] U.S. Census Bureau. Annual Estimates of the Resident Population for States, Vintage 2025 (NST-EST2025-ALLDATA). July 1, 2025. Accessed 2026-10-04.
• [17] Board of Governors of the Federal Reserve System. H.15 Selected Interest Rates, October 2, 2026. Week ending 2026-10-01. Accessed 2026-10-04.

Tier 2: trade bodies, market research, company data (2)

• [18] National Association of Home Builders. AD&C Financing Survey, Second Quarter 2026 summary. Q2 2026. Accessed 2026-10-04.
• [19] National Association of Home Builders. Volume of Residential Construction Loans Falls in Q4 2024 (Eye On Housing). Q4 2024. Accessed 2026-10-04.