Will a 'hard Brexit' make the housing crisis worse?
Brexit is going to happen. What is less certain is whether it will be soft, hard, or somewhere in the middle. Most of the advice on offer has to be treated with scepticism because it comes either from people who support Brexit or from people who would like to stop it, and the bias shows in the reporting. There are, however, some figures that are as hard as the hardest possible Brexit, and of these we do have to take notice.
- 9% of workers in the construction sector are from other EU countries. In London, that percentage rises to about 33% (Centre for Economics and Business Research (CEBR))
- The number of new jobs likely to be created in construction over the next five years is 230,000 (Construction Industry Training Board (CITB))
- New homes built in England and Wales in 2015 amounted to 142,390. While this was a welcome 20% annual rise, it was still not much more than half of the 250,000 that need to be built to satisfy demand (CITB)
Clearly, if a hard Brexit meant that all non-British Europeans currently working in construction in Britain were instructed to leave immediately, the construction industry would be in serious difficulty. In fact, it has been suggested that we could lose 8% of our current construction sector workforce. The number of new homes built would fall, and the increase in already unmet demand could have only one result: that house prices would continue to rise, and probably at a faster rate than we have seen recently.
We may, however, take comfort from recent statements by Theresa May and other members of the government, who have made it clear that – whatever happens in the upcoming negotiations with the EU – non-British EU citizens who are already here and already have a job will be free to remain. That suggests that a hard Brexit, if that is what we get, will not make an already difficult housing situation even worse.
There is, though, another figure that all homeowners who may possibly think about a move to a larger house might like to bear in mind. According to the Royal Institute of Chartered Surveyors (RICS), house prices are likely to continue to rise. They see it as a simple matter of supply and demand - there are not enough houses available, so you have to pay more to buy one.
The effect of that is likely to be that homeowners who might have chosen to move to a larger house will, instead, extend the one they are already living in. The good news is that the workforce they will need to call on to carry out that extension is likely still to be here. There are, though, two observations we would like to make:
- We need to do more to train more British citizens in the construction industry, so that the need for personnel can be met, if and when it arises.
- Home extension work produces a good deal of waste material, and that is our business, because getting rid of waste material safely and legally usually requires a skip.
If you have a construction project that will generate waste, call us. Getting rid of material that people no longer need is our business.