The Federation of Master Builders (FMB) House Builders’ Survey 2019 has evidenced Self and Custom Build as a vital source of work for its members, stressing the need for the two sectors to work together. For the first time, NaCSBA included questions in the survey about SME house builders’ working practices around building owner-commissioned homes.
The results found that over half of the FMB’s house builder members had constructed a home to the plan and specification of a new home owner over the last year.
The FMB’s annual House Builders’ Survey is an important indicator of market health for smaller builders, as it assess the market and the constraints facing the small- and medium-sized house builders (SME). This is key work as the sector experienced dramatic decline since the late Eighties, when it built two thirds of all UK homes. By 2014 this had dropped to just a third, and since 2007 the number of SME house builders has halved. In an era when Government is striving to reach its target of creating 300,000 homes a year, this loss of capacity is a serious limiter to the market.
Consequently, Government wants to see a return of the SME house builders to the market, and Custom and Self Build aspirations should be a key element in providing a work stream for the sector as a valuable source of additional new housing. As Sir Oliver Letwin found in his Independent Review of Build Out, creating more diversity in homes supply improves choice and has a direct impact in build out rates. Therefore, the empirical link between NaCSBA and the FMB strengthens both in their ambitions to remove barriers to growth, such as access to land and finance.
The House Builders Survey 2019 found:
- 52% of house builder members have built a new home to the plan and specification of the new home owner in the last year
- Of these the vast majority (42%) have built one, 32% have built 2, 10% have built 4-5 and 12% have built 6-10 homes
- The vast majority (68%) reported that one of these was on land they obtained for the development, 19% reported 2-3, 8% reported 4-5 and 3 reported 6-10.
Andrew Baddeley-Chappell, CEO, National Custom and Self Build Association said: “Custom and Self Build has the potential to help the Government reach its targets of creating 300,000 homes per year by the mid 2020s, and the SME sector is crucial in delivering this.
“We want to see more opportunities that create a level playing field that enables our sector to operate in the same conditions as the large housebuilders, such as having a Help to Build Equity Loan that mirrors the support that Help to Buy Equity Loan has given to the mass market. A Help to Build Equity Loan would also provide low-cost development finance to SME house builders, helping them to flourish and grow. NaCSBA continues to work to help more people achieve their ambition of having a home that reflects their needs, choices and budgets.”
Brian Berry, Chief Executive of the FMB, said “If the Government is going to increase both the quantity and quality of new homes a more diverse house building industry is needed. The largest house builders build over 80% of all new homes, and just over 20% are built by SME house builders. This used to be the reverse with SMEs building two thirds of all new homes in the late 1980s.
“What this new research shows is that custom and self-build can help bolster SMEs because, without local builders to help find land, service the plots and to build the houses, Custom and Self Build delivery is much more difficult. This is why the FMB is working closely with NaCSBA to share data and knowledge to help the sector grow. The FMB is urging the Government to support the Custom and Self Build sector, by encouraging prospective home owners to consider building their own home through policy solutions such as the Help to Build Equity Loan scheme idea.”