Will the latest new-build intervention encourage a more diverse range of projects through developers of all sizes?
There are many important questions to which I struggle to find a definitive answer. Why does a round pizza come in a square box? Why is there a light in the fridge but not in the freezer? Why does mineral water that has “trickled through mountains for centuries” go out of date next year? But being serious for a moment, let’s evaluate a far more pertinent question that is still largely unanswered: why isn’t enough new and affordable housing being built?
The bridging of this supply gap is a long-standing conundrum that has dogged the UK for a sustained period. It has featured highly on all recent government agendas but a continued lack of available land, planning delays, lingering funding issues and a shortage of skilled workers mean there are no straightforward or imminent solutions.
Positive signs are in the offing, however. The recent announcement of a package of measures to increase housebuilding – including a £3bn Home Building Fund and £2bn of new investment for accelerated construction on public land – is a step in the right direction.
It is estimated that the Home Building Fund will help enable SMEs, custom builders and developers to deliver more than 225,000 new homes. In addition, the Government plans to pilot accelerated construction on public land, taking government-owned land and partnering with contractors and investors to speed up housebuilding. In recent times, new-build has been dominated largely by the bigger housebuilders. But let’s hope that this latest government intervention will encourage and accelerate a wider, more diverse range of projects across the UK through developers of all sizes.
If the right balance of new homes is found, this should translate into more opportunities for those in the intermediary community who have established solid relationships and affiliations within the new-build sector.
Tony Fullbrook is head of mortgage purchases at Barclays Mortgages