Calls for more new homes and help for small to medium size construction firms

Survey respondents reported on cutbacks to new residential building projects and more caution among clients in response to interest rates, which have risen. Meanwhile, the Federation of Master Builders is calling on the government to give a clear commitment to building new homes.

Brian Berry, Chief Executive of the FMB, which seeks to protect the interests of small and medium-sized building firms, said: “Small, local housebuilders are struggling in a market that has seen the fastest decline in residential construction since May 2020, which was when the country was gripped by the pandemic. At a time when we need to be building more homes we are moving in the opposite direction and building fewer."

He adds: “While it might be politically easy to shelve housing commitments to gain votes in some areas, the Government must recommit to their annual housing target of 300,000 homes. I’m concerned that the Government lacks a clear plan to solve the housing crisis, resulting in overcrowding and increasingly unaffordable rents as more cling on to rental properties as the new housing market shrinks. “

We asked Paul Brown, who has been in the property development business for 35 years, for his thoughts on the market for new homes in Yorkshire and the issues facing small to medium sized house builders in our region. Paul was the founder and former MD of Caedmon Homes and is now MD of Huddersfield based Yorkshire Country Properties, which is building a total of 90 homes on sites in Shepley, Skelmanthorpe and Denby Dale with an ambition to expand to build 150 homes a year both in and outside of Yorkshire.

The good news, he says, is that the cost of some building materials, including steel and timber, has started to reduce slightly after rocketing during the pandemic due to shortages and demand. Another positive for the industry is that many would-be buyers are looking at buying new-builds thanks to their energy efficiency, which means lower bills.

“That is a big selling point. That’s why on the second phase of the Shepley development we will have timber frame houses that will have A rated for energy performance,” says Paul. “We are using solar photovoltaic cells that convert the sun’s energy into electricity plus battery storage for that energy.

"We will also be installing ground source heat pumps via a communal network of boreholes. They are much better than air source heat pumps, which generally aren’t as efficient and cost more to run.”

Most SME builders focus on smaller developments, which are more appealing than extra large sites and there is often an emphasis on quality both in design and materials, which appeals to would-be buyers. We build in stone and go above and beyond the minimum quality standards. No corners are cut.

“There is also a mix of housing types, so that the properties don’t all look the same and the roads generally have curves rather than long straight lines. Buyers like that,” says Paul.

One of the main concerns for SME developers is access to finance, which is tightening, while would-be buyers are faced with higher mortgage interest rates, though Paul thinks this difficult phase will be short-lived and the worst will be over by the middle of next year. Another pressing issue is the ongoing shortage of tradespeople. Some SMEs have their own team, while many others, including Yorkshire Country Properties, hire tradespeople in but have their own site manager to ensure everyone works as a team and quality is maintained.

The issue that gets most SME builders foaming at the mouth is the planning system and the time it takes from putting a planning application in to receiving a decision from the local authority. “The process needs speeding up, which means more staff in planning departments. The big developers can absorb a 12 to 18 month delay but SME’s struggle and it is a big problem for income streams,” says Paul, who wants to see Housing Secretary Michael Gove accelerate the planning process, something the minister has pledged to do.

He adds: “It is slowed down by objectors who don’t understand the national need for homes. We are woefully short of housing stock as we are a small island with a growing population. Brownfield isn’t the answer as there are constraints, including the cost of remediation. Government money to assist with remediation would help massively.”

*YCP are now on site at Shepley, Skelmanthorpe and Denby Dale. For details visit www.yorkshirecountryproperties.co.uk