30.01.20
Government green lights £1bn funding for SME builders
The Housing Secretary has confirmed financial support of £1bn to support small and medium sized builders to enter the housing market.
Rt Hon Robert Henrick MP announced yesterday (Jan 29) that small and medium sized building firms will be eligible for millions of pounds in loans to enable new homes to be delivered across England.
The British Business Bank’s ENABLE Build Programme, aimed at smaller housebuilders, will ensure that enough credit is available for them to enter the market.
The programme will begin shortly according to the announcement, guaranteeing millions in funding for local, independent construction businesses.
Under the new scheme, local builders will be able to obtain loans from participating banks to underpin the commitment of at least a million new homes delivered in the next five years.
Housing Secretary, Rt Hon Robert Jenrick MP, said
“Small housebuilders are vital to building the homes this country needs but too often struggle to access affordable finance.
“Today I am giving the green light to a scheme that will help to fix this. Supporting £1 billion of new loans so that local builders can kickstart building, level up the country and turbocharge the housing sector.”
Since it first opened for applications in May 2019, specialist and mainstream lenders, including high street banks, have asked to be involved in the scheme.
Housing Ministe,r Rt Hon Esther McVey MP, added:
“When it comes to building houses, we mean business – this fund will give everyday lenders the confidence needed to do deals with smaller builders which get shovels in the ground.
“Today I have given the green light to £1 billion in loans to boost local builders, so they can deliver the homes our communities need across England.”
Figures show that only 1,737 small to medium size builders operate in England, and more are needed to respond to the demand for new houses.
Commenting on the affect this could have on local councils, Tracy Harrison, Chief Executive of The Northern Housing Consortium said:
"We welcome the boost to diversifying the house-building sector and encouraging the growth of small and medium size developers. In the North, where we have many sites that may be more challenging from a viability perspective, we’ve been told by LA colleagues that it’s the SME’s with a real sense of ownership, commitment and ‘skin in the game’ who are likely to see a tricky development through to completion, and that tenacity can be vital.
"Many of our local authority members in the North are working proactively to encourage and support SME builders back into the market and Northern planning authorities are working to bring forward smaller sites for development. This diversification in turn drives innovation and modern methods of construction in the market, supported by the North’s growing status as a ‘construction corridor’."