UK construction news 2024, British building industry output, United Kingdom housebuilding guide

UK construction news in 2024

post updated 9 December 2024

Major overhaul of planning committees to get Britain building

As set out in the Plan for Change, the government is fully focused on unlocking economic growth across the country. To support this, the Deputy Prime Minister Angela Rayner has set out plans to speed up the planning process and support better decision making in the system.

Fergus Charlton, planning law partner at national law firm, Michelmores, has reacted to today’s news about there being a major overhaul of planning committees to get Britain building:

“The proposals are certainly bold, and the government should be commended for that.

“There are many components of the planning system that can be improved, and planning committees are certainly one of those. Most developers’ experience of committees is akin to a rollercoaster ride, and they may well prefer to rely on the professionalism of a planning officer to make the decision, avoiding the vagaries of a committee decision if that can be done. The beneficial effect of these proposals will turn on how the phrase ‘complies with the development plan’ is interpreted.

“One omission to focus on is that planning decisions must be made in accordance with the development plan and any material considerations. Very often those material considerations turn on local knowledge and awareness. Good decision planning committees can critically evaluate those pertinent material considerations, but these play no part in the proposed options for the national scheme of delegation. This may be to the detriment of good decision making.

I also feel for the planning officers. Their decision-making responsibilities will become that much more stressful.”

9 December 2024

Overhaul of UK planning committees – changes correctly target blockage in current system

Planning decisions are set to be fast-tracked in a sweeping overhaul of local planning committees, as part of new measures to tackle the housing crisis, the Government has announced today.

Under new plans to modernise the planning approval process, applications that comply with local development plans could bypass planning committees entirely.

Alun Williams, partner at London law firm Spector Constant & Williams said:
“Certainly, the new policies announced do correctly target the area where the greatest blockage in the system occurs. Far too many planning committee decisions are delayed for a wide range of sometimes very mundane reasons. When nimbyism and local politics also enter the equation then the route to obtaining a consent becomes tortuous.

The cries from the opponents of these reforms, usually on the basis that they will bypass the views of the local community, rather miss the point. The time to properly take in the views and requirements of the community should be in the adoption of the Local Development Plan allowing Developers to work towards an objective set of goals, rather than dealing with the subjective and often arbitrary views of individual councillors currently voiced at what really ought to be the end of the process, rather than the beginning of a protracted resubmission or appeals process.”

post updated 15 October 2024

Comment on Labour delaying 40% of infrastructure projects and falling short of homes target by 500k

Houses of Parliament, England, UK

UK Infrastructure Delays & Housing Shortfall

Commenting on Labour delaying 40% of major infrastructure project decisions and falling short of its homes target by 500k, Daniel Austin, CEO and co-founder at ASK Partners, said:

“Housing remains a pivotal issue for Labour, closely tied to economic stability. Despite recent upticks in house prices and mortgage approvals, the UK faces a severe housing shortage that threatens to prolong the economic downturn. This shortage, driven by insufficient homes for rent and sale, has led to an affordability crisis, contributing to GDP strain and decades of unresolved social pressure. It’s particularly concerning that new analysis reveals government delays in 40% of major infrastructure project decisions.

Several nationally significant infrastructure projects (NSIPs), intended to follow a “fast-track” approval process, have been delayed since Labour came to power, according to the Britain Remade campaign. Under the Conservatives, the rate was slightly lower, with 38% of projects delayed. Additionally, recent research indicates that Labour risks falling short of its 1.5 million homes target by 500,000 unless it intervenes with additional funding for the housing market.

“The UK urgently needs a comprehensive, long-term housing strategy, and the Autumn Statement presents a critical opportunity to offer much-needed clarity on the UK’s economic direction. While the target of building 300,000 homes annually has been a missed government goal since 2004, experts, including Capital Economics, argue that a more ambitious goal of 385,000 homes per year is essential. Meanwhile, France has significantly outpaced the UK in housing construction.

“The UK’s housing crisis stems from four key challenges: an over-reliance on major housebuilders, a politicised planning system that stifles development, a net loss of social housing, and post-Brexit labour shortages. To overcome these obstacles, revitalising SME housebuilders is crucial. This can be achieved through a mix of incentives, access to small land plots, streamlined planning for brownfield sites, and increased availability of skilled domestic labour. Independent planning decisions, combined with private-sector collaboration, would help reduce delays and costs, while lenders offering flexible financing options could further support smaller developers. Although a pro-growth agenda may be politically contentious in the short term, it is essential for addressing the housing crisis. A strong housing policy is vital not only for economic recovery but also for securing long-term prosperity across the UK.”

Previously on e-architect:

17 July 2024

King’s Speech: Why Property Development Needs Incentivising

David Hannah comments on Labour’s plans to accelerate housebuilding

UK Housebuilding Acceleration

Putting growth at the heart of Labour’s policy agenda, the King’s Speech outlined further details on the new government’s plan to build 1.5 million new homes over the next five years. The plans are certainly ambitious, with last week’s speech from Chancellor Rachel Reeves detailing the introduction of mandatory housing targets and the removal of “red tape” for the approval of developments. According to David Hannah, Group Chairman of Cornerstone Tax, the plans outlined by King Charles earlier today fail to mention one essential factor: private developers.

Hannah asserts that developers simply do not have the ability to ramp up their work overnight, whilst also suggesting that stricter housebuilding targets will only discourage growth within the construction industry through adverse incentives. In order to stimulate the development sector and get Britain building again, Hannah instead recommends that developers be offered a tax break, encouraging market entrants whilst providing the necessary capital to embark on Labour’s ambitious homebuilding goals.

David Hannah, Group Chairman of Cornerstone Tax, comments:

“Labour’s plans are incredibly ambitious, no doubt about that, however, there remain several important elements that are yet to be addressed. It’s been described by some commentators as a ‘War on NIMBYs’ and it’s not hard to see why. The decision to cut red tape and remove blockages to planning make for good soundbites, but we have little clarity as to what this means in practice. Will Labour ignore the concerns of local residents in favour of the ‘greater good’? It remains to be seen.

“Labour must also address the ‘Developer-shaped’ Elephant in the room. For years private developers have been plagued with high interest rates and an ever-increasing tax burden. Earlier this year, a CMA probe found that several major firms had been persistently under delivering on their housing targets, perhaps due to a chronic lack of working capital. Developers cannot simply ramp up their output overnight, the new government must create new incentives for the sector, and punitive housing targets are not the way to go.

“Private developers ought to be offered a tax break for the vital services that they provide, encouraging new entrants to the market whilst also stimulating further economic growth.”

17 July 2024

Ambitious Housebuilding Targets in the King’s Speech

Please see below a reactive commentary to today’s King’s Speech and the Government’s changes to planning reform from a UK law firm:

Ifath Nawaz, Senior Consultant Solicitor Planning, Setfords commented: “While we welcome the proposed improvements to the planning system, which has been neglected for many years, there are real concerns that without significant new resources to support Local Authorities, the ambitious housebuilding targets in the King’s Speech cannot be delivered. Local Authorities are already struggling to attract the expertise needed in their planning departments to handle the current workload, let alone an anticipated increase in new housing developments.

“As well as more resources, they need enhanced enforcement powers to get the homes built once developments are approved, to overcome the local objections that so often frustrate new housing. We have seen in London and Manchester the benefits of powers being devolved to local administrations. The Government’s housebuilding ambitions can only be achieved with more investment and resources, particularly for local government.”

17 July 2024

New Labour government potential impacts on building regulations

Comment by Hexo Operations Manager Dan Robson:

At Hexo, a leading electrical testing service in London specializing in EICR certification, we recognise the potential impacts of a new Labour government on building regulations. With the likelihood of new and stricter social legislation being introduced, both councils and private sector landlords will face heightened requirements regarding building maintenance and tenant safety and health.

The Labour Party has consistently advocated for improved tenant protections and stricter safety regulations. This includes enhanced scrutiny on Electrical Installation Condition Reports (EICRs) and smoke detection systems, ensuring that all rented properties meet rigorous safety standards. The new administration may introduce comprehensive reviews of existing regulations within the next year, focusing on enforcing higher standards of safety and maintenance.

Landlords and businesses must take proactive steps to comply with these anticipated changes. Ensuring your EICR certification is current is not just a legal obligation but a critical measure to protect tenants from potential electrical hazards. Regular inspections and timely updates to electrical installations can prevent serious safety issues and legal complications.

For businesses, compliance with Health and Safety legislation is paramount. This legislation requires a valid EICR and certified emergency lighting to ensure the safety of workers and visitors. Non-compliance could result in severe penalties, including fines and potential liability in the event of accidents – and rightly so!

At Hexo, we are committed to helping our clients navigate these regulatory changes smoothly. We offer comprehensive EICR assessments and certification services, along with certified emergency lighting inspections. Our team of experts is dedicated to ensuring that your properties and workplaces meet the highest safety standards, keeping you ahead of legislative requirements.

16 Feb 2024

Renewed optimism but smaller developers still face a challenging year, says new report

White paper into prospects for UK resi developers launched by Davon, mezzanine finance specialist.

UK Housing Market Optimism

Smaller residential developers have a sense of renewed optimism this year, says specialist lender Davon, but they still face perennial challenges.
In a new report on the State of the Market, the mezzanine finance provider warns that SME developers will have to wrestle with obstacles such as planning, land acquisition and supply issues in 2024.

David Norman, Director at Davon, says: “We detect more positive sentiment among developers as interest rates have eased. The goalposts look more firmly in place than has been the case, so developers can plan projects with more confidence, but they still face economic, regulatory and logistical fallout.”

The white paper makes three recommendations to stimulate smaller housebuilders, whose share of the new home market has fallen from 40 per cent in the 1980s to 12 per cent today.

1. The government and the finance industry need to change the funding landscape in light of new and persistent challenges facing SME developers.
2. The planning system is too slow and must be improved. The latest regulations look good on paper but planners need to put them into practice.
3. Mezzanine finance gives smaller developers a way to overcome obstacles, deal with delays and free up capital for future projects

The report titled State of the Residential Market in 2024: Opportunities and Challenges for SME Developers also includes a beginner’s guide to mezzanine finance.

It is free to download at https://www.davonltd.com/post/new-white-paper-state-of-the-residential-development-market-2024

Davon provides mezzanine finance for SME developers such as Ashley and Tracy James who have built this seaside mansion in Braunton, Devon, southwest England, UK:
Seaside mansion in Braunton, Devon, southwest England, UK

Founded in 1996 with more than 25 years of experience in the mezzanine finance sector and property development finance, Davon supports residential and mixed use property developers to finance projects ranging from large-scale property developments to buy-to-let property refurbishments.
www.davonltd.com

3 May 2023

UK house prices rise comment

Commenting on UK property prices, chronic undersupply but entering a period of further growth, Tom Brown, Managing Director of Real Estate at Ingenious, said:

“The UK housing sector is proving resilient in the face of tightening interest rates and relatively high taxation. The sector’s performance supports the view that there is chronic undersupply across our markets, underpinning asset pricing and market liquidity in areas of established demand.

As the economy slowly recovers, undersupply outweighs the drag on the sector from fiscal tightening. With rates forecast to be at or nearing their peak, we expect a relatively positive outlook to be maintained over coming months, with prices stabilising before entering a period of further growth.”

2 May 2023

UK house prices rise in April after seven consecutive falls

UK House Prices Rise

Average house prices rose by 0.5% last month according to Nationwide.

David Hannah, Group Chairman at Cornerstone Tax, discusses the recent rise in house prices and why he remains confident in the market:

A recent report from Nationwide has found that the average house prices rose 0.5% last month following seven consecutive falls from September. In light of thisnews, property expert and Group Chairman of Cornerstone Tax, David Hannah, gives his thoughts on why house prices have risen in April and why he remains confident in the market.

The 0.5% rise means the average price has increased to £260,441, up from £257,122 in March. This has lifted the annual rate of house price growth to -2.7%, from -3.1% in March (the biggest fall since 2009), marking a return to composure in the market following the chaos of last autumn’s mini-budget. Hannah believes that the increase in house prices for April is a sign that the property market’s re-adjustment period may be ending as new mortgage rates begin to fall, which has resulted in a wave of buyers returning to the market.

In line with the findings from Nationwide, Zoopla reported at the start of April that there was a greater supply of houses on the market, 65% more than a year ago, as the average estate agent has 25 homes for sale compared to 14 in 2022. Zoopla reported that the number of new sales agreed had risen 11% compared to 2019. Despite the calls from forecasters for the market to crash by 20% this year, it remains resilient, which Hannah believes is a testament to its historical stability.

David Hannah, Group Chairman of Cornerstone Tax, explains:

“The UK is going through a re-adjustment period regarding property prices and is slowly adapting to the new rates of mortgages. However, we are already beginning to see a fall in fixed rate mortgages, which has resulted in a wave of buyers returning to the property market.

“It is also crucial to remember that we must look at the bigger picture when assessing the state of the property market, not just the most recent developments – look how quickly the narrative has changed compared to the start of Q1.

“The UK property market has tended to be more stable than any other global market in the world. I expect to see low to mid to single-digit growth throughout the rest of this year despite the common narrative regarding falls or even a crash. Despite the negative predictions currently, there is an underlying pressure on the market which is leading to upward pressure on prices.”

Previously on e-architect:

post updated 26 April 2023

The top must-sees at UK Construction Week London – UKCW

Featuring the latest innovation and technology, cutting edge equipment, famous faces and an abundance of networking opportunities, UK Construction Week (UKCW) has revealed its list of the top recommended things to see and do at the upcoming London show in May (2-4).

UK Construction Week London

UK Construction Week London 2023

The event opens next week and will see over 300 market leading brands exhibiting. The event will bring together construction experts and passionate individuals gather at the ExCel in London for the three-day exhibition, here are the key features you’ll want to keep an eye out:

• To get the show off to a rather compelling start, UKCW has once again teamed up with Construction Sport in the form of a boating regatta which will see four teams race boats made from construction waste materials across Royal Victoria Dock on the opening morning of the show’s first day, Tuesday 2nd May.

• A plethora of world-class seminars, CPD sessions and presentations are what’s in store for visitors throughout the show. The packed programme of seminars will focus on a myriad of important industry topics, complemented by 150 hours of dedicated CPD opportunities across 9 hubs dedicated to Sustainability, Infrastructure, Offsite Construction and more.

• Shining a spotlight on the unsung heroes and talented professionals in the construction industry, the shortlist for the show’s Role Models Campaign, now in its sixth year, will be announced on Wednesday 3rd May at 15.30 and presented by Victoria Derbyshire.

• Celebrating Culture Change in Construction, the London show will host three days of debate and discussion from top speakers on how the industry can move forward to tackle its biggest issues. Confirmed speakers include: Mark Thurston (HS2), Caroline Gumble(CIOB), Bola Abisogun (BIM Academy), Rebecca Lovelace(Building People) BBC editors and presenters Simon Jack and Victoria Derbyshire and more! The show also features a dedicated Culture Change Hub with programming from National Federation of Builders, Building People and Design & Build.

• Visitors can expect appearances from high-profile industry leaders including Parliamentary Under Secretary of State for Energy Efficiency and Green Finance Lord Callanan, and TV personality George Clarke who will be officially opening the show.

• Robotics, sustainability, and productivity will all be highlighted in Future Lab, including exciting UK show exclusives and innovative exhibitors from around the world. Each product featured in Future Lab is the beginning of something new in building a home or building: from renewable mycelium products to 3D printers, telescopic steel frames to recycled bricks, bio-cement to robotic systems, radiative cooling paint and more…

• Join Amit Oberoi, Executive Chairman at Considerate Construction Scheme, as he hosts a talk on culture change and what it means for the construction industry. Amit has over 20 years of experience in leadership roles across many sectors and worked across multiple markets with governments on high-profile transformation and infrastructure projects, including the FIFA World Cup in Qatar.

• Three full scale builds will be at the show from top innovators British Offsite, @Home Systems and Zero Construct in partnership with Automatic Construction.

• Interactive demos will be hosted by HP who will premiere their autonomous site layout printer and COBOD, the world leader in 3D construction printing will be doing VR demos of the BOD2 3D construction printer.

• Within the show’s packed programme of workshops and talks, UKCW are putting health and safety at work high up on their agenda. Visitors can experience featured debates and discussions around themes such as building safety and regulation; mental health and wellbeing; quality control and more.

Nathan Garnett, show director for UKCW London, commented: “Visitor numbers for this year’s show indicate that attendance will be at a record breaking high. We can’t wait to get the whole construction industry together once more to debate, discuss and resolve important issues and marvel over exciting innovations in the sector. We’re also really excited to see the vessels created and cheer on our teams at the Construction Sport boating regatta to mark the opening of the show – we know it’s going to be bigger and better than ever before.”
There’s still time to register for the free event: ukcw-london-2023.reg.buzz/cab-campaign-pr

6 February 2023

UK Construction PMI Update

UK construction news - British buildings

UK Construction PMI News – February 2023

Following the release of the UK Construction PMI this morning (6 February 2023), Joe Sullivan, partner at MHA, believes the government must tackle concerns surrounding higher interest rate and mortgage affordability to boost confidence in the market as the recession starts to bite:

“We’re beginning to feel the recession’s full impact. For weaker companies cracks are starting appear. They can no longer just survive on cheap borrowing and past Covid-19 government initiatives. Well-run operations and companies will survive but must maintain a clear business plan, focusing on reducing contract risk and cost control. Material price inflation may have eased but the cost of specialist labour and steel will still increase this year.

“For the housing market, falling prices do not equate to more transactions, as homeowners remain content staying put, largely due to the recession and the creeping impact of higher borrowing costs. As more fixed mortgage rate terms end during this period of higher interest rates, mortgage affordability will become an ever more salient issue. Higher interest rates and mortgages will further impact the rental market as rising costs will be passed on to tenants, affecting their ability to save for home deposits.

“To address concerns surrounding energy-efficient homes, especially as the energy crisis rumbles on, the government could further underwrite loans to finance activity on energy-saving materials such as solar panels and ground source heat pumps. They could also provide further tax breaks to businesses investing in renewable technology.

“Confidence could be further enhanced by the government providing additional clarity over infrastructure projects. Ultimately while the sector will be hit by short term profitability and cash flow losses, in the medium term, it should prove resilient. Easter should see some positive steps towards rebuilding confidence unless we encounter some unexpected economic shocks along the way.”

Previously on e-architect:

13 December 2022

Construction slowdown predicted until 2027, BCIS analysis reveals

UK Construction Slowdown News

New work output in the construction industry will not reach pre-pandemic levels until 2027, according to new analysis from the Building Cost Information Service (BCIS).

As part of its quarterly data briefing, BCIS has revealed its short and long-term forecast for UK construction – and the outlook remains challenging as the industry continues to grapple with the impact of Covid-19, Brexit and the war in Ukraine.

According to data collected and analysed by BCIS, total construction output has only just reached pre-pandemic levels, largely driven by growth in the repair and maintenance sector – but new work output is still below 2019 levels.

Dr David Crosthwaite, Head of Consultancy Services at BCIS, said: “Our forecasts suggest new construction work output won’t return to pre-crises levels until late 2027 – that’s almost eight years of no real growth in the sector.

“Stagflation is a very real possibility, not only in our sector but across the wider economy. Little or no growth coupled with high inflation is a very poor environment for construction investment.

“The positive news is that it appears supply constraints are easing, leading to costs and prices stabilising in the long run.

“We think inflation has peaked and we could be over the worst of it – all eyes are now turning to the length and depth of recession.”

Commercial construction – the biggest sub sector in the industry – has seen the largest decline in output over the past two years, with growth predicted to be minimal through to 2027, as requirements for retail and office space have fundamentally changed since the pandemic.

BCIS also predicts a slowdown in the private housing sector over the next couple of years before a rebound – but output is still expected to remain below pre-crisis levels.

Dr Crosthwaite added: “The repair and maintenance sector will continue to grow, but sectors reliant on new investment will stagnate, as well as those relying on public spending and government borrowing.

“Infrastructure output has grown and is predicted to continue – and spending may be used as a stimulant to boost the wider economy.”

Material cost increases have far outstripped labour cost increases, but BCIS forecasts material costs to decline and return to trend during 2023. Labour cost increases are expected to persist for slightly longer, returning to trend in 2025.

High energy-use components, including steel, concrete and plasterboard, as well as specialist labour, are expected to continue to experience inflationary pressures until the energy crisis is abated.

David added: “Price increases are slowing, suggesting we’re past the peak of the inflationary problem.

“The industry should be congratulated for weathering the economic headwinds over the past few years reasonably well.

“Our market conditions index suggests the impact of the latest crises have been less severe than the impact of the 2008 financial crash, which is encouraging – but the outlook for construction continues to be challenging for the immediate future.”

BCIS

The Building Cost Information Service (BCIS) is the leading independent provider of construction data to the built environment and insurance sectors. For some 60 years, BCIS has been collecting, collating, analysing, modelling and interpreting cost information to support built environment professionals, helping them provide cost advice, to have confidence in commercial decision-making and to mitigate risk.

www.bcis.co.uk

Previously on e-architect:

9 December 2022

UK Mini-Budget and Construction: Big disappointment no stamp duty relief for downsizers

UK construction news London property development

UK Mini-budget Construction News for 2022

Following the release of the UK Construction PMI, Brendan Sharkey, Head of Construction and Real Estate at MHA, believes confidence and activity is currently steady but 2023 is set to be a bleak year:

“Despite declining sector optimism regarding the UK’s economic outlook, the construction sector continues to cope well. Firms have a steady pipeline of work going into 2023 because many projects were pushed backed this year. For many, last month’s Autumn Statement occasioned a big sigh of relief as there were no reductions to existing infrastructure spending.

“However, whilst the short-term outlook is reasonable, the further one peers ahead the grimmer it looks. No one feels very confident about the back end of 2023.

UK construction activity to grow in 2022

“For the housing market, demand is tailing off amidst the cost of living crisis and the imminent recession. The ending of the Help to Buy equity loan scheme in March 2023 will mean many will struggle to enter the property market in the short term. The eventual stabilisation of interest rates and property prices will provide some relief for homeowners and potential buyers but there is no confidence as to timing.

“2023 will see a very significant change within the rental property market due to the forthcoming series of Energy Performance Certificate (EPC) rating deadlines, which begin April. The costs of meeting the EPC requirements means many are reluctant to upgrade homes to meet the minimum required rating of E by April 2023, C by April 2025 for new tenants and C for all homes by April 2028. However, unless the government defers the timelines, property landlords will have to take action which should create opportunities for tradesmen to specialise in retrofit energy efficiency upgrades.

UK construction news: PMI, sector review

“To encourage further building projects, the government should support local planning departments to recruit the staff they need to address the clear backlog within the planning application system. The cost of this could be recovered from the developers. Improvements to the planning process would also be welcome as this would unlock current projects and give the developers an opportunity to turn their much maligned land bank into homes and cashflow. Ultimately while 2022 was not a bad year for construction, 2023 looks uncertain but, as ever, the best run construction companies will survive.”

Previously on e-architect:

26 September 2022

UK Mini-Budget and Construction – big disappointment no stamp duty relief for downsizers

UK Mini-budget Construction News

Following the mini-budget last week where the Chancellor confirmed a reduction in Stamp Duty, Brendan Sharkey, head of Construction and Real estate at MHA, says the Stamp Duty reduction is positive but it won’t have the impact it did during the pandemic:

UK construction activity to grow City of London buildings

UK construction activity survey news

Comments on this UK construction news: PMI, sector review are welcome

UK Construction News

New UK Housing: British Housebuilding
New UK Housing

UK Construction Industry recovery news
UK Construction Industry recovery

UK asbestos removal from buildings within 40 years
UK asbestos removal from buildings

New Construction Output Increase Comment
UK Construction Industry recovery news site
image courtesy of article provider
UK Construction Industry recovery news

How will Construction Industry respond to Brexit?
How will the construction industry respond to Brexit
How will Construction Industry respond to Brexit?

Brexit Impact on UK Construction Industry News
Brexit Impact on UK Construction Industry

COVID-19 Crisis Impact on Buildings

COVID-19 and reinvention of the construction industry Report News
COVID-19 construction industry reinvention

How the coronavirus will affect urban design
How COVID-19 changes urban design
picture courtesy of article provider
How COVID-19 changes urban design

How COVID-19 is changing the way we work
How COVID-19 changes the way we work
image courtesy of article provider
How COVID-19 changes the way we work

Doing your homework on working remote
COVID-19 Remote Working Architects in Zoom meeting
visual courtesy of article provider
COVID-19 Remote Working

Coronavirus on the property market

coronavirus world stats

Construction Industry leveraging Big Data for Gains

Comments / photos for the UK construction news: PMI, sector review page welcome