Two thirds of SME housebuilders are struggling to identify land for development, according to new research from the Federation of Master Builders (FMB).
For the second year in a row, the FMB’s annual House Builders’ Survey has shown a lack of available and viable land as the biggest barrier to SMEs delivering more new homes. Half of SMEs see the planning system and difficulties accessing finance as other serious challenges
Commenting on the latest report, Brian Berry, Chief Executive of the FMB, said: “The biggest challenge facing SME house builders is the planning process. Councils need to find a way of allocating and granting planning permission for more small sites. The current focus on large sites is squeezing out smaller developers, which is reducing competition in the housing market at a time when we need more, not less, choice. The limited supply of opportunities for small scale development is one of a number of key structural constraints that has seen the number of homes built by SMEs decline from around two thirds in the late 1980s to less than a quarter today.”
The skills crisis was also highlighted in the latest survey with 40% of respondants believing the construction skills crisis is now presenting a major impediment to building more homes.
A further cause of concern is the under-resourcing of local authority planning departments. The survey highlights this issue as the most important cause of delays in the planning process
Brian Berry said: “95% of SME house builders report that the information demands being placed on them during the planning application process have either increased or remain as bad as they were before. Our survey shows that the primary cause of unnecessary delays is the planning process, with the under-resourcing of planning departments being the most important concern.”
The FMB House Builders’ Survey 2016 is available here.