Builders of all sizes needed to "fix broken housing market"

The housing market is ruled by volume housebuilders and this dominance must be reduced to “help fix the broken housing market,” concludes a report from the Communities and Local Government Committee following an inquiry it launched last year into housebuilding capacity.

Related topics:  Property
Warren Lewis
3rd May 2017
house construction
"The housing market is broken, we are simply not building enough homes"

In its report, the committee calls for a more competitive housing market, claiming that the eight largest housebuilders build more than half of all new homes in the country. It urges the government to support SME builders and improve access to land and finance for them, as well as reduce risks for builders by providing planning permissions and infrastructure for sites.

The MPs of the committee suggest learning from the German model of financial support for SMEs, which uses a state-owned development bank offering low rates to customers.

The report also asks for increased building by local authorities and housing associations, which it says will help protect the industry against downturns.

And the committee would like to see the government more actively support modern methods of construction, including sponsoring a “single, recognised quality assurance mark to give lenders, builders and consumers confidence”.

The report also highlights the skills gap with the need for the government to produce solid proposals, particularly on improving further education paths into the construction industry.

Clive Betts MP, chair of the CLG Committee, said: "The housing market is broken, we are simply not building enough homes. Smaller builders are in decline and the sector is over reliant on an alarmingly small number of high volume developers.”
Stewart Baseley, HBF’s executive chairman, said that larger firms were generally better equipped to deal with the challenges of building and could spread risks.

But he added: “We fully support the committee’s call for measures to assist smaller builders, encourage new entrants and scale up specialist housing sectors, such as the retirement housing market.

“The vast majority of the big increases in housing supply in recent years have come from the larger, mainstream builders- but we need more builders of all sizes and specialisms if we are to tackle our acute housing shortage.”

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