The Federation of Master Builders' (FMB) latest state of trade survey revealed SME workloads continued to grow in the final quarter of 2015, but at a lesser pace compared to three months earlier.
It is understood around 29% of respondents reported higher activity levels, down from 39%, while 23% of firms revealed lower workloads, up from 13%.
While businesses are predicting rising activity levels over the next three months, it is expected this will be at a much slower rate compared with previous figures.
More firms are predicting a fall in workloads (19% vs 14%) while the share of firms expecting higher workloads dropped from 32% to 22%.
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Out prices, wages and salaries are also expected to increase over the next six months. However, the net balance for output prices posted a fall of 2% as fewer respondents (45% vs 57%) expect price growth.
Brian Berry, Chief Executive of the FMB, said the slowdown experienced in the last quarter is a "cause for concern".
"Undoubtedly, the adverse weather experienced in large parts of the country has played its part, by causing projects to overrun and costs to spiral. However, the fact that both current and expected construction workloads are down in every region is worrying given some of the gloomy predictions being made about the wider economy."
Mr Berry added: "Most concerning is that the last three months of 2015 represent the first quarter in nearly three years in which private sector SME housebuilding showed a negative balance. Even if this is a temporary blip, it comes at a time when merely managing to tread water would be inadequate in tackling the housing crisis.
"We need firms of all sizes firing on all cylinders if we’re going to address the chronic under-supply of housing but, unfortunately, a complex set of problems continue to constrain smaller developers.
"A concerted effort to tackle ongoing issues around access to finance, availability of suitable small sites and shortages of skilled labour is vital.
"The survey findings underline the latter point, showing 52% of our members reporting difficulty in finding carpenters and joiners, and 50% continue to have trouble hiring quality bricklayers."
(LM)
