Finance barrier leaves small builders struggling to deliver enough new homes
The government's aim to build more homes by providing more support for small to medium-sized builders is faltering as it's revealed finance barriers are making it hard for smaller builders to deliver the number of homes required.
According to a survey from the Federation of Master Builders (FMB), 54% of small builders are struggling to secure finance, which is hindering their ability to build new homes. A further 62% say that a lack of available or suitable sites is a real issue in their ability to deliver new homes.
During the Financial Crisis, the number of small builders dwindled. The reduction in the number of SME builders is partly due to a lack of new sites available to build on and a lack of funds. Brexit is also said to be contributing to the plight of small builders, as a shortage of skilled workers will likely get worse once the UK leaves the EU.
Chief Executive at the FMB, Brian Berry, said: "Almost a decade after the financial crisis, access to finance for small house builders is getting worse instead of better. The results of the FMB House Builders’ Survey suggest a slight worsening in the problems these firms face in accessing the finance they need to build".
He continued: "The (Housing) White Paper quite rightly emphasises the need to diversify the house building sector so it is less reliant on a small number of large house builders. In order to do this, we need the Government to make good on its proposals to improve the availability of small sites and speed-up the planning process for small sites".
The Housing White Paper, which was published earlier this year, recognised the need to make it easier for small builders to find suitable sites, to access the funds they need, and streamline the planning process. These findings from the FMB suggest that although government efforts have helped, there is still more work to do.
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