“The fall in construction output in November, the largest drop since May 2013, is disappointing news and comes as a result of a variety of factors, including skills shortages and rising material costs. While the fortunes of the big four housebuilders have continued to improve, increasing output from smaller developers will be crucial in helping to reach the targets set by the government for 400,000 affordable new homes by 2020.
“In the 1990s, the SME and regional sectors built as much as 80% of new homes in the UK but over the past six years this figure has fallen to under 50%. Despite the huge demand for new houses, smaller developers continue to struggle with access to finance, with a recent industry survey showing that more than 50,000 construction and real estate firms experienced have begun the year in ‘significant’ financial distress.
“The Home Builders Federation have said that the new housebuilding targets are achievable, and proposed changes to planning regulations and incentives for building on brownfield land are positive steps. However, unless more is done by lenders to increase funding to smaller regional developers, the potential for the industry to reach 200,000 homes per year - a level of building not seen in Britain since 1989 – will be less likely.”
For further enquiries, journalists can contact:
Johnathan Priestley, Cicero Group
Phone: 0207 297 5954
Rachael Snelling, Aldermore
Phone: 0208 1853 102
Notes to editors:
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