Often when speaking with housing industry contacts the response to “how is Brexit going to impact your business?” is “it depends on the deal”. I’m now asking what it is we can do to make sure that, at the very minimum, we protect our industry from the potential risks of Brexit and flourish outside of the EU.
There are a few challenges in housebuilding at the moment, as highlighted in the recent housing white paper – namely the growing skills gap, access to finance (particularly for smaller developers) and the way that we build our new homes.
On top of this, Brexit will directly impact the cost of construction materials imported from the EU, which could then cause a domino effect on house prices and overall build quality. Therefore, we as an industry and the government must work out a contingency plan to make the UK more self-reliant and minimise the effect on businesses and house prices.
As it stands around 20% of total construction material imports used in the British housebuilding industry are imported, with 59% of that figure directly from the EU.
Coupled with the pound struggling against other currencies, imports are becoming more expensive, which is squeezing small developers and trade supply businesses.
Firstly, component and material manufacturers need security of business, so if there is a housing market crash in the UK, they need to be able to look elsewhere for business. In order to import into the EU, components and materials are still going to have to be made to EU standards, therefore the only way to differentiate is either on price or going above and beyond.
We must incentivise manufacturers to produce materials of the highest quality and to do this they must be able to not only trade within the UK, but to the EU and across the globe – that has to be at the front of the government’s minds during negotiations.
Secondly, homes built (or part-built) on offsite locations is a potential solution as it is possible to mechanise more of the roles, which in turn means different types of skills are needed. This process is still being tested and developed; if partnerships could be forged with British-based manufacturers we would immediately decrease our reliance on imports, whilst creating new jobs for the industry.
Ultimately, materials make homes, so we need to ensure that higher tariffs or trade restrictions post-Brexit don’t impact the quality of what we build in the UK. Driving higher housing standards is not only better for those who live in these new homes, but it also drives exports to the rest of the world. This is where Home Quality Mark and BREEAM (the sustainability mark) hope to drive up standards in new homes so the industry comes out stronger.
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