Research reveals lack of land limits SME house builders

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According to research by the Federation of Master Builders’ (FMB), a lack of small sites and limited finance tops the list of barriers to SME house builders

Results from the FMB’s House Builders’ Survey 2017 include:

• Over half of SME house builders (54%) say accessing finance is a major barrier to their ability to build more homes;

• A lack of available and viable land is the most commonly cited barrier (62%) to increasing output;

• 42% of SME house builders said that a shortage of skilled workers is a barrier to their ability to build more new homes;

• One in three SME house builders that employ EU workers believe the end of free movement will be a major restraint on their ability to build more homes;

• 49% of SME house builders view the planning system as a major restriction on their ability to develop and ‘inadequate resourcing of planning departments’ was rated as the most significant cause of delay in the planning application process.

Chief Executive of 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. Assessments of lending conditions to SME developers were down slightly from 2016, the first fall in this measure since 2013. Small house builders express generally positive views of some recent government initiatives in this area, such as the Home Building Fund, but we clearly need to double down on these efforts to make sure that SMEs have access to the finance they need to build Britain out of its housing crisis.”

Berry added: “Our research also affirms just how vital it is that the government acts on key proposals in the Housing White Paper, published earlier this year and designed to increase the opportunities for smaller scale development.”

Berry concluded: “The potential impact of post-Brexit immigration changes is… a cause for concern among small house builders. That’s why it’s so important that the government introduces a transitionary period that allows the UK house building sector to gradually wean itself off high levels of EU labour.”

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