Despite challenges including the current planning system, a skills shortage and uncertainty following the EU Referendum, housebuilders are forecasting increased growth and investment in the sector.
In the latest Lloyds Bank Commercial Banking report on the UK housebuilding sector which is the first study following Brexit
- 36% of house builders said that the uncertainty following the EU referendum result is the biggest challenge to their business
- Optimism about the future of the housebuilding industry has picked up slightly from 7.1 last year to 7.2 in 2016, with 10 representing the highest level of expectation.
- The outlook has given the industry the confidence to invest, with average five-year investment plans up 17% year on year.
- Housebuilders confident about growth, with 42% of respondents saying that their growth forecasts had improved since the EU vote, compared with 27% who said they had declined.
- They are predicting an average growth of 28% over the next five years, up from 25% last year.
Sector Challenges Key findings
- Challenges that the sector highlighted, after the EU referendum result, include the rising cost of materials (35%) and the current planning system (29%).
- While the UK continues to face the housing shortage, (22%) of housebuilders do not believe the sector has the resources it needs to help the Government achieve its targets for new housing, and 14% are unsure.
- Firms also said that the availability of government support (32 per cent) and suitable land (29 per cent) are factors that impact the industry’s ability to meet targets for new housing.
- 30 per cent of firms said there are not enough skilled workers in the industry, with bricklayers, electricians, plumbers and joiners being the hardest to recruit.
- Recruitment and skills therefore remain a focus, with three of the top priorities for firms over the next five years being recruiting additional staff (52 per cent), and investing in training (49 per cent) and apprenticeships (32 per cent).