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Housebuilders call for action to save SME development sector

Posted: Tuesday, September 3rd, 2024

Pocket Living and leaders of the housebuilding industry have launched a new campaign calling on the Government to take immediate action to save the industry from potential collapse, Specification Online reported.

The campaign responds to the new government's Getting Britain Building Again challenge and reflects the dire situation currently facing many SME housebuilders.

Ten policy recommendations have been published on how the government should rejuvenate the SME housebuilding sector, support the target of constructing 1.5 million homes, and increase competition and choice for renters and purchasers of new homes.

These include streamlining the planning committee process, unlocking housing delivery on smaller sites, and enabling Homes England to support SME developers better.

Several proposals could be incorporated into the government’s NPPF reform, which Angela Rayner announced this week.

The need for such intervention is critical, as the number of SME housebuilders has plummeted to fewer than 2,500 today, down from over 12,000 in the late 1980s.

This alarming decline, along with other factors such as access to labour, construction costs, contractor insolvencies and the challenges of the planning system, has triggered an urgent warning from the industry that planning reform alone will not deliver the homes Britain needs without the builders to build them.

This campaign follows a series of announcements from the chancellor, Rachel Reeves. Major players such as Berkeley Group, CIOB, and various SMEs have contributed. It suggests a range of cost-effective and easily actionable policies.

SMEs are responsible for only 10% of the UK’s housing output, a significant drop from the 1960s and 70s when they contributed nearly 50% of new homes. This percentage is also considerably lower than that of many European countries.

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