ANOTHER BRICK IN THE WALL

You must be of a certain age to remember Pink Floyd’s epic rock opera ‘Wall’ (1979), either way, there aren’t enough bricks in this construction to adequately represent everything that’s going on right now.


2022 got away to a good start with record output recorded by May this year. However, the downward pressure of numerous issues – some related, others not, is starting to take its toll on the industry. There are a range of factors that can be categorised:

ECONOMICS

SECTOR

POLITICS

ENVIRONMENT

Inflation

Materials

Brexit

Energy costs

Interest rate

Cladding

Change of PM

Ukraine

Recession

Labour

Policies

Sustainability

All the above concern getting product built and sold. And without question there has never been a time with more at stake than now. Government rhetoric echoes the words of Prime Ministers and Housing Ministers of the last decade …. “Build more houses!” Fine, but right now it is less about volume and more about navigating difficult waters that are making house building an enormously challenging profession.


The most pressing issues are dealing with material shortages, rising costs, and labour deficits. Part Ukraine, part Covid, part Brexit. Its impossible to predict if the worst has been received, or is yet to come, and frankly not a lot we can do to influence it either way. But there are aspects to the way the industry is going that can help alleviate matters – modular construction has taken off and, despite some early failures, will become a significant player in the longer term. This should assist in both labour issues as well as material costs. A factory production line approach may help better control costs and reduce the extent to which labour is required at site. Ultimately this could permanently change the way developing is undertaken with a contractor to prep the land and lay roads/services, followed by a small team who manage modular deliveries.


Our nation’s economics are part reality and part perception. Because what we pay for fuel and how much we’re charged to borrow money is largely outside our control, the cost of living will be influenced not just by domestic decisions, but by activity on a world stage. Where we can mitigate matters is in the politics of a new PM and his or her cabinet and policies. Confidence is all, in a shaky economy, so we can talk ourselves out of a recession just as we can talk ourselves into one. Finishing Brexit was the hottest topic on any government agenda one minute, and yesterday’s news as soon as the pandemic began to bite. Now that Covid is no longer the minute-by-minute focus of our lives, we must learn to live with it and re-group to tackle the immediate problems created by Brexit i.e., labour availability (or lack thereof).


Having skilfully navigated through these choppy seas and achieved a profitable outcome i.e., product complete and buyer found, there’s just one more thing to consider, one that is not in our table of troublesome topics ‘The New Homes Quality Code’. This has probably not featured too prominently so far, given that a high proportion of businesses aren’t yet registered, and 31 December appears a long way off right now. But it is coming and when it arrives it will impose a way of working that will apply to every new home for sale developer up and down the land.


As this year progresses, we suspect that more and more will need to get their head around precisely what this will mean to their business. It’s not a barrier to trade, it’s a standard by which all housebuilders must operate, and in the event of a problem further down the road (post completion) how they must manage a complaint.


As final words are penned in this article, we see that Liz Truss has declared, if she wins the race to lead the Tory Party (and the country) she will abandon the 300,000 new homes target!

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