HBF Publishes Report on Economic Footprint of UK House Building
It has long been argued, by many within it, that the house building industry and the construction of new homes contributes to the national and local economy and now there is finally a document to support this.
Nathaniel Lichfield & Partners and the Home Builders Federation published, on 24th March, The Economic Footprint of UK House Building which assesses the economic footprint of the national house building industry, quantifying its contribution to the national economy. The document was presented to the house building industry at the Home Builders Federation Policy Conference 2015 on 24th March.
The NPPF refers to the three dimensions of sustainable development: economic, social and environmental and states that there is a need for the planning system to perform within these roles. As a result, it has become necessary to demonstrate how proposed residential schemes contribute towards each of these roles. The recent study by NLP looked at a wide range of benefits brought to the UK economy through the building of homes.
In the UK last year approximately 140,000 new homes were built, the economic value of these on the economy included, amongst many others, the following:
- £11bn of annual capital investment and expenditure on new land for housing development;
- £5.5bm was spent on suppliers, with 90% of this staying in the UK;
- Over 233,000 people are directly employed within the industry, which equates to just under 18% of the total employment within the construction sector;
- Up to 606,580 jobs have been created across a range of organisations, operations and occupations – equivalent to 4.3 jobs per dwelling;
- Around 38% of the new homes built are ‘affordable’;
- Estimates show that residents of new homes built within the last year generated £3.8bn of spending in shops and services over the course of the year and a further £780m was spent in one-off spending to make a new house ‘feel like a home’;
- Over £576m of S106 contributions are made each year towards funding facilities and services, including: £225m on education facilities;
- £72.6m on open space; £40m on community facilities; and
- £18.2m on sports and leisure; with the remaining £220m going towards transportation, health and public art.
It is important to recognise that the above benefits were achieved whilst under delivering the required number of new homes across the UK, if the number of homes built is increased, addressing need the benefits to the economy would be even greater.
Therefore, to constrain supply when there is evidently increased optimism amongst buyers with increased opportunities to finance new homes is unnecessary and unwelcome where such clear economic and social benefits can be gained through the supply of homes.
It is evident that the UK house building industry contributes a significant amount to the UK economy, therefore it is up to the industry and the individuals involved to continue bringing forward new homes to drive economic growth within the UK.
In the lead up to the General Election in May the need to build homes and address the shortfall across the UK is at the forefront of all parties’ manifestos and how each party's would address this if they come to power. It can only be argued that the publication of this document will serve to increase the focus on the house building industry long-term and ensure that following the election the matter does not fall by the wayside and become forgotten about in policy reform and review. The release of each parties’ manifestos within the next couple of weeks may provide a clear indication on this.
NJL are currently advising clients on over 8,000 new homes across the UK and last year secured a large number of planning permissions on a range of sites on behalf of clients.
If you have a site which may be suitable for residential development which NJL can help you with please do not hesitate to get in touch and together we can do our bit for the UK’s economy.
Images used courtesy of wikimedia.org, American Advisors Group on Flickr and Summer Skyes 11 on Flickr