Small and medium businesses will be the key to reaching the Labour government’s house building targets, Together chief commercial officer, Ryan Etchells, claims.
Etchells comments follow the Labour government's pledge to build 1.5mn houses in five years.
However, he warned the government has not had a successful track record when providing housing in the recent past.
“The government has been telling us that every year for 15 years that there are around 300,000 houses a year that need building and I think they’ve managed to achieve about 150,000 one year in that period,” he said.
He said, for the UK to achieve that kind of house building growth, it would not be able to rely on the big FTSE 100 companies because “they’ve got into the habit of land banking”.
Instead, he predicted the growth in housing would come from SME house builders that are building 10-15 units.
He said these smaller builders will be able to take advantage of brownfield sites or small pockets of green field sites, aiding the government’s house building targets
Etchells said another issue with reaching the current housing targets was building the right kind of houses.
“It’s not just that there’s not enough housing stock being built, there’s not enough housing stock being built for affordable homes or energy efficient homes,” he explained.
“At the moment, the amount of retro fitting that has to happen once properties have been built is a lot.
“That’s because a lot of the focus has been on the massive house builders in my opinion.”
Etchells claimed companies building a thousand units at a time and are doing so in the cheapest way to maximise the yield of their property yields.
While he said he understands why these builders operate like this “that’s not what is going to achieve what we’re going to need over the next few years”.
“Labour is never going to unlock those massive landbanks of green belt that the big house builders own because they’re too big,” he added.
“You’re talking about structural changes to the country, infrastructure changes that would have to happen.
“That’s not going to get us the housing stock we need, we need to support small and medium sized builders.”
tom.dunstan@ft.com
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