Ahead of the Spring Statement, Mark White, managing director of SME housebuilder Bargate, who is a board member of both the HBF and Future Homes Hub, and also chair of the Hub’s SME liaison group, shares his thoughts.
A Spring Statement with no policy announcements – or expectations of a last-minute rabbit out of a hat by Reeves – is clearly not going to boost property market transactions. Without any strength in the buying market, housebuilders are in no position to increase productivity.
The industry that supports close to one million UK jobs and generates over £50billion per year is currently struggling to make ends meet, largely due to pre-commencement conditions and the extra burden of new legislation, regulations and levies.
As a business that has long been promoting the journey to net zero and the move over to electric vehicles, it is very disappointing to hear that the chancellor is proposing to levy a per-mile tax on zero-emission vehicles. Having driven an electric car myself for several years, I would advocate that there should be positive outcomes for those making the switch. Why is the government retrospectively moving the fiscal goalposts on an initiative that has been fundamental to its environmental policies?
The prospect of a drop in the Bank of England Base Rate at the next Monetary Policy Committee Meeting on Thursday 19 March is the only glimmer of hope that could boost to the housing market. Given the billions of extra revenue that could be generated for the Treasury, it is hard to comprehend why the chancellor is unwilling to announce any new policies ahead of the crucial spring residential property season.
Taking Bargate as a case in point, we have the ability to increase the number of homes we build by 25% per annum. The same growth is achievable for most SMEs. Creating sustainable clusters of family homes and enhancing traditional communities within edge of settlement, semi-rural and rural locations is the usual sweet spot for Bargate and many of our peers. That is where we can be distinctive and prioritise design quality, green technologies and placemaking over ugly densification. It’s the ability to scale up without compromising on quality that makes small and medium housebuilders so invaluable to the overall health of the new homes industry – and the economy as a whole.
The only way the government can get any traction for scaling up the delivery of new homes is if a demand-side initiative is announced and launched with immediate effect. Stimulating the bottom of the chain is essential to get Britain moving and building. Without a market step change, we will be heading for another year of record low completions.
I’ve long been an advocate for the introduction of government subsidies to boost the take-up of Green Mortgages, which are only available for homes rated EPC-A or B. Either that, or a baby brother version of Help to Buy – something all housebuilders have been crying out for.
Housebuilders need one big initiative that works as well as Help to Buy did for a decade. While it’s widely known that some PLC housebuilders used it to inflate house prices, those of us with genuine intentions to simply assist buyers have been punished since its withdrawal. I hope the chancellor can see that doing nothing is not going to boost her personal appeal with voters, or the Treasury’s coffers.
