Development Loans News:- New house building starts showed a year-on-year decline of 8 per cent for the second quarter, according to Office of National Statistics data.

In the three months to June, 37,220 new homes were started – a 2 per cent decline on the previous quarter. Annual new builds totalled 160,640 in the year to June 2019 – a 1 per cent year-on-year decrease.

All starts between April and June 2019 were 117 per cent above the trough in the March quarter of 2009 and 24 per cent below the March quarter peak of 2007.

However, completions were estimated at 45,190 – a 4 per cent increase from the previous quarter and 11 per cent higher than a year ago. In the year to June 2019 completions totalled 173,660 – an 8 per cent year-on-year increase.

All completions between April and June 2019 were 79 per cent above the trough in the March quarter of 2013 and 7 per cent below the March quarter 2007 peak.

Housing secretary Robert Jenrick was upbeat about the completion figures.

“The number of new homes built reaching an 11-year high. We are moving in the right direction, but there is still much more to do if we are going to deliver the numbers needed by communities up and down the country.

“The last year also saw the proportion of family houses built increase to 78 per cent of all the new dwellings delivered in the marketplace – the highest the figure has been since 2000.”

Private enterprise new build dwelling starts in the second quarter were down by 2 per cent compared with the previous quarter. Starts by housing associations were 4 per cent lower compared with a year ago but completions were up by 20 per cent.

Longer visas needed post-Brexit

The Federation of Master Builders said it would be difficult for the construction industry to hit government targets for new house builds without a more flexible visa system for non-UK workers.

FMB chief executive, Brian Berry, said he agreed with Construction Industry Training Board’s report, Migration and Construction which calls for the one-year visa for low skilled workers to be extended to two.

“The report is absolutely right to highlight the barriers facing construction employers needing to employ non-UK workers. The government needs to look again at its post-Brexit immigration system to make it easier and simpler for small building companies needing to recruit non-UK labour,” he said.

Mr Berry highlighted the building industry’s skill shortage evidenced by the fact that 9 per cent of construction workers are EU citizens.

“Given it takes many years to train a high-quality tradesperson there will, in the short-term at least, continue to be an urgent need to recruit non-UK labour. Without this labour the industry will not be able to deliver the homes and key infrastructure projects that are needed to underpin the UK’s national productivity and growth,” he said.

Development Loans by HZA

Brokers Hank Zarihs Associates said builders needed a full complement of workers to hit completion targets. The brokerage added that development finance lenders would be able to offer instant bridging finance to give SME housebuilders breathing space.

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Shiraz Khan is the author of the content. Shiraz is the managing director and founder of Hank Zarihs Associates. With over 16 years' of experience we are master brokers within the short term financing industry. We specialise in a wide variety of short term loans.