Easier finance helping small housebuilders, says FMB

Easier finance helping small housebuilders, says FMB

Access to finance for SME housebuilders is showing signs of improvement, according to the Federation of Master Builders’ (FMB) latest survey of small house builders. 

The Federation of Master Builders has unveilled its latest research – the 2015 House Builders’ Survey – which demonstrates growth in the SME housebuilding market. Lending conditions were reported to be improving although 52% of respondants indicated they were involved in sites that were stalled because of financial reasons.

Brian Berry, Chief Executive of the FMB, said: “We are at last starting to see some real improvements in our members’ ability to deliver new housing. The FMB’s 2015 House Builders’ Survey shows increased levels of participation in house building by small builders, boosted by a buoyant housing market and Government moves to improve access to finance. However, it is still disappointing that nearly two thirds of builders cite difficulty in accessing finance as inhibiting their ability to deliver new housing. Too many small developers are being held back by banks’ reluctance to lend for small scale development, which is stopping new building. Government initiatives, such as the Builders Finance Fund and Housing Growth Partnership, have helped ease the situation but it needs to continue to seek ways of encouraging the flow of finance into the SME sector. Some form of loan guarantees, or further well-judged interventions along the lines of the Housing Growth Partnership, would be helpful.”

Another major barrier identified was the availability of viable land for development, which was the most commonly cited barrier (68%). This was the first time since the survey started that ‘lack of finance to the company’ was not the most commonly-cited barrier.

Berry noted: “There is still a long way to go to help reverse the huge decline in the number of SME house builders over the course of the economic downturn. Our survey shows that availability of suitable and viable small sites is now the most commonly cited barrier to delivery. This seems to be most keenly felt by those looking to develop small sites of fewer than five units. Hopefully, new Government initiatives designed to speed up the approval of small sites will help address the problem.”

Responding to the Survey results, Housing and Planning Minister Brandon Lewis MP said: “Our new Housing Growth Partnership will also help smaller builders invest in new projects, allowing them to recruit and train skilled workers and become more competitive in their local area. I’d encourage them to apply for a share of this £100m fund.”

The ‘FMB House Builders’ Survey 2015′ is available here.


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