Brick shortage driving up cost of houses

1.4 billion bricks are needed to fix the housing crisis, and supply is waning August 25, 2016 / Isla MacFarlane
Brick shortage driving up cost of houses

A shortage of brick supply has been a contributing factor in rising house prices over the past decade, as growing demand continues to outstrip availability of housing, according to the Bricks Report from National Association of Estate Agents (NAEA), compiled with the Centre for Economics and Business Research (Cebr).

Between 2006 and 2016, the growing UK population triggered exponential growth in demand, and has now outgrown the number of houses being built. Given that in 2016 the average UK home is made up of 5,180 bricks, resolving the housing shortage of 264,000 units would require 1.4 billion bricks.

The impact of Brexit could significantly worsen the issue. In 2015, 85 per cent of all imported clay and cement (primary brick components) came from the EU, and so depending on how trade negotiations develop, Brexit could have a considerable impact on supply.

Brick stock steadily declined between 2008 and 2013 and only partially recovered in 2014 and 2015. Two-thirds of small and medium-sized construction businesses faced a two-month wait for new brick orders last year, with almost a quarter waiting for up to four months and one in six (16 per cent) waiting six to eight months. This can partially be explained by the slowdown in building following the recession.

“We all know that the massive lack of supply in housing is an issue that needs resolving urgently,” said Mark Hayward, Managing Director, National Association of Estate Agents (NAEA) comments. “As well as freeing up more land to ensure we can build the right sort of houses in the right places, it’s crucial we have the right materials and skills to do so.

“It seems a simple consideration but the fact that we don’t have enough bricks to meet demand has a very real effect and holds up the process from beginning to end. We’re concerned that the impact of the EU Referendum means this problem could get worse as we rely on the import of brick components from the EU and of course many of our skilled labourers come from there too.”

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