Labour's new homes goal will not be met without reversing the decline in SME house building sector

“Labour’s focus on channelling available finance into new house building projects is welcome. Land and finance remain the key ingredients in bringing forward new housing and to increase supply to the extent that Labour is aiming to we will need to see more of both. FMB surveys of small and medium-sized (SME) house builders over the past three years have consistently found that difficulty in accessing finance is the most common barrier to them being able to build more. If we cannot reverse the decline in the SME house building sector then it is difficult to see how we can deliver the 200,000 new homes per year Labour is aiming for.

“Labour has already recognised this by pledging to put in place a ‘Help to Build’ system of loan guarantees on private lending to SME house builders – this latest announcement maintains their focus on helping finance to flow into house building. The success of this policy will inevitably depend on the details of implementation, but increasing available pools of funding and encouraging the banks to lend into the sector should help.”