View more on these topics

Government needs to support SME housebuilder lending: IMLA

Bricks building housing construction

The mortgage market wants the Government to better support lending to SME housebuilders, according to the Intermediary Mortgage Lenders Association.

IMLA research says 61 per cent of lenders and 57 per cent of brokers feel more state support for development finance would help address the lack of housing supply.

The trade body is urging policymakers to take action on the issue.

An IMLA statement says: “Successive governments have failed to address the supply-side issues challenging the UK housing market, despite an array of different initiatives.”

The trade body criticised the Government’s recent housing white paper for not giving decent solutions to UK housing issues.

Data from the Department of Communities and Local Government shows new house completions were down 1 per cent in the year to December 2016 compared to the previous twelve months.

SME housebuilders say getting finance is one of the big challenges they face when trying to deliver new homes.

These challenges include the cost and availability of finance, unfavourable loan-to-asset ratios and reportedly poor relationships between builders and some lenders.

IMLA executive director Peter Williams says: “As well as promoting development finance, the government should explore a scheme that guarantees loans to SME builders.

“Our research reveals that lenders view the biggest obstacle they face in development finance is a higher risk of builder default.

“At the same time, builders report that accessing finance is an obstacle to increasing their output.

“By launching a guarantee scheme, or boosting lending to developers via the British Business Bank, policymakers could increase the flow of development finance and improve output in the sector.”

Recommended

Cover feature: Will new-build crumble?

  The new-build sector has been growing steadily but issues over ground rents and the future of Help to Buy could shake its foundations  The launch of the Help to Buy equity loan scheme in 2013 lay the foundation for a much-needed reconstruction of the new-build sector. The market has rebuilt itself in recent years, […]

My Opinion: The hurdles new build needs to clear

High rents and low interest rates are positive for new-build but developers must build good properties at realistic prices Having worked in the new-build market for more than 15 years, I have seen clear evidence that a significant proportion of homebuyers strive to buy a brand-new property at some stage in their life. Some like […]

Andrew-Montlake-700.jpg

Market Watch: When builders don’t help themselves

At least one newspaper believes the new-build leasehold issue has the potential to be the worst scandal since PPI So the new tax year is under way and the first stage of changes to landlords’ income and tax regimes is now in effect. The press has been full of stories around this, with one landlord […]

Five ways to invest in the connected world

Smart utility metering; fitness trackers; connected cars; smart factories; precision agriculture: the internet of things encompasses myriad applications. But how do you gain exposure – and profit – from this growing trend, asks Neptune fund manager & CTO Ali Unwin. Read more: Important information Investment risks Neptune funds may have a high historic volatility rating […]

Nigeria cover image - thumbnail

White paper — Nigeria International Insights

Jelf Employee Benefits closely examines healthcare provision and challenges within Nigeria. This will be of particular interest to HR decision makers with employees based in Nigeria, and assesses the environment, risks, facilities and safeguards that are relevant to organisations that are actively deploying expatriate staff in this location.

Newsletter

News and expert analysis straight to your inbox

Sign up
Close

Why register with Mortgage Strategy?

Mortgage Strategy continues to be the market-leading B2B mortgage publication in the UK, and provides trusted, independent insight with the aim of helping, promoting and analysing the latest developments for mortgage professionals.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Mortgage Strategy Events
Be the first to hear about our industry leading conferences, awards, webinars and more.

Research and insight
Take part in and see the results of Mortgage Strategy's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now