Number of small housebuilders at 30-year low

The number of small and medium housebuilders in the UK is at its lowest for 30 years, a study by the Federation of Master Builders reveals.

Data from the NHBC, which covers nearly 90% of the market, was used in the study and showed that the number of active housebuilders that had built fewer than 500 units fell to 3,824 in 2010, the lowest since records began in 1982.

Brian Berry, director of external affairs at the FMB said the lack of smaller housebuilders would hamper a number of the government’s objectives.

“In the National Policy Planning Framework the government is talking about giving communities choice but that will be deadened if local housebuilders are forced out of the market,” he said.

He added that having SME housebuilders is more sustainable because they are more willing to use smaller brownfield sites, which the larger housebuilders don’t want.

Chris Carr, joint managing director at Carr & Carr Builders, a medium-sized firm, said many smaller builders were moving towards doing extensions and repair and maintenance work as opposed to new housing.

“They have just got disillusioned with the planning system and people are just not bothering,” he said. “Councils are asking for more and more reports to go with applications and they all cost. You’ve got to be a full scale builder to carry that cost.”

Carr said he had been charged up to £25,000 in planning fees for developments of four properties.

He also commented that small housebuilders were seen as high risk by banks.