Why is the Home Building Fund failing to reach small builders?


Despite being the main target of the fund and the ones that need it most, SME housebuilders are struggling to access the cash

The signs are clear: the residential construction market is slowing down. With all the recent political and economic uncertainty perhaps it is no surprise, but recent data points to an undeniable trend, with housing starts in 2019 significantly down on the previous year and figures for planning permissions showing the first fall since the end of the financial crisis.

Over a longer period, the contribution to new housing from small to medium-sized housebuilders is dwindling. In 1988 more than 12,000 SMEs built 40% of all new homes, but by 2017 SME housebuilders had dwindled in number to around 2,500 and accounted for only 12% of new stock, according to a study by the Home Builders Federation (HBF).

Combined with the slowdown in overall housebuilding activity, this makes hitting the government target of building a million homes over the next parliament especially challenging…

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