Page 2 - Supplement - Bridging & Commercial Magazine Issue 5
P. 2

  Over the past few years, property developers have faced unexpected challenges which hinder and halt the viability of their schemes and further contributes to the UK housing crisis.
One challenge includes the uncertainty surrounding Brexit, which has continued to disrupt the development process. For example, in the Federation of Master Builders’ (FMB) Q2 2019 State of Trade Survey, it was reported that 60%
of SMEs were finding it difficult
to hire bricklayers and 54% were struggling to recruit carpenters
and joiners. Also, a staggering
77% of builders predicted
material prices to rise further this year, while 21% of employers announced a reduced workforce.
Consequently, the market is seeing construction delays and cost overruns, impacting not just the developers, but the lenders within this market.
This coincides with a slowing property market, with August 2019 being the ninth month in a row that annual house price growth remained under the 1% mark. As a result, more developers are now looking
to retain their schemes to rent rather than a straightforward sale.
In 2018, the build-to-rent sector totalled £2.6bn in investment—up

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