The latest quarterly Scottish Construction Monitor found confidence recovered to plus two after falling to a three year low of minus 19 in the wake of the Brexit vote in June.
DOWNLOAD THE SCOTSMAN APP ON ITUNES OR GOOGLE PLAY
However the survey, which takes in to account the answers of hundreds of building companies across Scotland who are members of the federation, found the majority of respondents thought the prospect of Brexit was driving up supply costs.
Bricks, timber and metal products were all reported to have a noticeable rise in costs since June, according to respondents.
Ninety per cent of those surveyed expected these costs to continue to rise over the next 12 months, with many expressing concern that some suppliers may be using economic uncertainty to increase costs artificially.
Vaughan Hart, director of the Scottish Building Federation, said: “At the moment, the construction industry is experiencing the same uncertainties as those facing the wider economy.
“In that context, I’m encouraged that our members’ confidence seems quite resilient, having rebounded back into positive territory this quarter following last quarter’s negative reading.
“In the current climate, it’s important that we don’t inadvertently talk ourselves into an economic downturn by over-analysing the economic indicators out there or jumping to conclusions about how the economy is performing when these aren’t borne out by experience on the ground.
“We need to remain vigilant against suppliers exploiting the current economic uncertainty to increase costs artificially.
“I would encourage building employers to bring any such practices to our attention so that we can raise these with Government and make sure industry competitiveness isn’t adversely affected as a result.”
The construction industry is said to contribute around £10 billion to Scotland’s GDP and has traditionally provided direct or indirect employment to more than 200,000 people, according to the Scottish Building Federation.