Government urged to fix housing crisis with more building loans for small firms
Policy makers have been told to deliver more building loans for small construction firms, after a trade organisationdeclared existing’strategies had failed to fix Britain’s housing crisis.
New research from the Intermediary Mortgage Lenders Association (IMLA), a trade body representing the interests of the mortgage market, revealed 61 per cent of UK mortgage lenders believed greater finance opportunities for smaller house builders would be act as a vital solution to the country’s housing shortage.
A Home Building Fund was announced by government in its housing white paper in February 2017, giving small firms and property developers access to building loans from a 3bn fund.
The scheme was part of a move to diversify? the market and use smaller firms to grow the country’s housing output.
In a statement, IMLA director Peter Williams said a lack of solutions? offered in the white paper meant new ideas were needed.
iMLA is therefore calling on policy makers to explore how they can boost development finance lending, he said.
Williams said access to building loans remained the single biggest obstacle for small house builders. Key challenges cited by constructionowners included poor relationships with lenders and builders and the general cost and availability of finance.
by launching a guarantee scheme, policy makers could increase the flow of development finance and improve output in the sector, Williams added.
To help meet house-building target set by the Department for Communities and Local Government (DCLG) a million new homes by the end of 2020 the IMLA encouraged the delivery of loans through the government-backed British Business Bank (BBB).
Praseeda Nair is the editorial director of Business Advice, and its sister publication for growing businesses, Real Business. She's an impassioned advocate for women in leadership, and likes to profile business owners, advisors and experts in the field of entrepreneurship and management.