Since 2004, the UK has had a target to build 270,000 new homes each year — a figure we’ve yet to achieve. In fact, the actual total has averaged at 148,563 properties since 2007, leaving the UK’s housing deficit standing at 1.2 million.
But today, the market paints a different picture. The Persimmons, Taylor Wimpeys and Barratts of the UK’s housing industry account for 88% of new builds, with just 12% of homes being built by small builders. In 1988, this figure stood at 40%.
Of course, our large house builders are critical if we’re ever to achieve these ambitious targets — Persimmon alone completed 15,171 house sales in 2016. That’s a number unthinkable for small builders.
But, there’s still a need for small, yet progressive and flexible house builders, who are willing to develop relatively modest pockets of brownfield land — typically the sites that are more beautiful, but also more challenging to develop.
While the 2007 recession alone managed to wipe out one third of small developers, there are a number of constant struggles that face new entrants, and stop smaller builders from growing.
Firstly, there are the continual efforts to secure implementable planning consent — which can create delays and present high risks, often leading to a lack of sustainable growth. There’s also the limited availability of financing options, with most developers having to negotiate finance on a lengthy, site-by-site basis. Increased bureaucracy — around highways, water and land registration — can also cause delays and further costs.
These barriers are often unattractive to the developers who build on smaller pieces of land, because these high costs make such sites unachievable, while larger sites can comfortably absorb extensive fees.
The result is that towns across the UK are experiencing an influx of almost identical houses to that of their neighbours. While this is understandable — economies of scale helps developers to offer customers more affordable homes — many communities are left frustrated that they’re losing their distinctiveness.
That’s where small house builders — such as SB Homes — come in. As with many industries, the ‘small guys’ are usually the ones with the most ‘fire in their bellies’ — willing to be entrepreneurial, creative and flexible.
For example, how many large house builders offer truly bespoke homes? They are held back by the economies of scale that make their homes somewhat affordable.
And because we’re small, it means that we can remain flexible, often submitting new site plans that better suit the environment and individual house plans when our clients want to make external or internal changes. Plus, we contribute to our local economy and community.
That’s the beauty of small, quality house builders — we’re generally more ‘in tune’ with the areas that we develop in, meaning that the homes we build are unique to their environment and widely respected by local people.
So, to alleviate the UK’s housing shortage, the government must do more to lift the barriers facing small house builders. This would allow the small companies to be able to compete more fairly, generating an influx of — arguably — better quality designed and built homes into our nation’s towns and communities.