The UK is currently facing a housing crisis that has been building up for the past few decades. For the Save Construction Initiative and those in the “thick of it, this isn’t breaking news.
The demand for affordable housing has significantly exceeded the supply, leading to soaring property prices and an increase in homelessness. A combination of factors such as population growth, lack of new home construction, and increased demand from foreign investors have contributed to this crisis.
The UK has not built enough homes to meet the growing demand, and this has caused a significant increase in property prices. Additionally, foreign investors have been purchasing properties in the UK, driving up prices even further. This has made it difficult for many people to afford a home, especially those on lower incomes. Another significant issue is the high cost of renting. Many people find themselves unable to save for a deposit to buy a home due to the high cost of renting.
The government has been implementing various measures to address the housing crisis, such as building new homes and increasing funding for social housing. However, more needs to be done to ensure that everyone has access to affordable and secure housing. The housing crisis is a complex issue that requires a comprehensive and sustained effort to solve.
Breaking it down further, the sector has faced several major obstacles, including Brexit, Grenfell, Covid, the Building Safety Bill and Legislation changes, the Net-Zero agenda, Skills Shortage, and material cost inflation and not forgetting the Ukrainian war. These challenges have diverted attention from increasing build performance towards creating new homes to dealing with the issues at hand.
Add to the mix, inconsistent proposals from successive governments towards the Levelling-up and Regeneration Bill: reforms to national planning policy. There have been six ministers for housing, five of those since 2022, with Lee Rowley being re-appointed again on 13th November after Rachel Maclean was asked to step down. Inconsistency at such a high level has contributed hugely to the current affordability crisis and resulted in the failed delivery of the government’s original target of 300,000 new homes per year.
Altogether it is a recipe for disaster and amplifies risk and instability for businesses throughout the built environment but despite the constant challenges, the sector is not surrendering and accepting failure, it continues to demonstrate strength and agility. It is tackling its vulnerabilities head-on!
On the 16th of November, SCI hosted an event looking at how organisations in the region are addressing adversity and implementing measures to create greater resilience in their business and how responsible clients and designers are mitigating risk throughout the supply chain.
Tim Whitehill, Director of SCI, Author of https://constructingexcellence.org.uk/organisational-resilience-are-we-built-on-a-house-of-cards/, and Hon research fellow at LJMU led the discussions. “We know the problems and we don’t want to dwell on them, it is time to focus on the winning strategies for success, today has been about focusing on the solutions”.
Keynote speakers and contributors to the discussions were Helen Spencer, Great Places Group, Sean Keyes, Sutcliffe and Mark Kitts, Tawd Valley Developments.
Helen Spencer is Executive Director of Growth at Great Places Housing Group.
“Great Places prides itself on the role it plays in tackling the housing crisis, and have committed to invest £1 billion in the delivery of new affordable homes. As of November 2023, we have 37 live sites, with over £325m invested in their delivery. We are focused on the customer expectations of those looking for affordable housing and our actions are a positive step towards creating a brighter future for all residents. To achieve this, resilience is a cornerstone of our strategy and we focus on collaboration and partners to maximise the resilience of our supply chains. This is also fundamental to the success of the ICN framework which is accessed by 34 RPs and Local Authorities, and provides procurement-compliant access to Contractors, and Consultants; this is out for tender at present and I’d encourage all suppliers to take a look.” Helen Spencer adds:
“For us, resilience is taking shape in many forms and we are always looking ahead at how we need to adapt. We are delivering a variety of tenures, direct profit for purpose outputs from our Cube Homes programme and have our in-house Contractor Terra Nova to share intelligence with. We are also mitigating risk by adopting different forms of contract which both protects us as the client but also our partners. Most importantly, collaboration with our framework partners and wider supply chain is essential; great outcomes for our customers takes a collective effort.”
Mark Kitts, Managing Director of Tawd Valley Homes
“Tawd Valley Homes is relatively new to the market, and we have faced our own challenges as a newly formed business trading through COVID. We are wholly owned by West Lancashire Borough Council and all our profits are reinvested into services that benefit the local communities. Our first scheme in Skelmersdale commenced on site in the summer of 2020 and since then we have delivered 100 new homes across 5 sites with a further 12 sites in the planning stages amounting to over 230 new homes.
We have been creating resilience through our strategic approach, research, and development, with our partners. Together we have been looking at renewable energy sources, MMC, and materials that are readily available and not subject to extreme price fluctuation. We’ve also been diligent when it comes to investing in the training of our workforce, ensuring they have ample skills to meet new regulations and challenges as well as taking a team-based approach to the delivery of our schemes and advancement of our pipeline as we diversify our portfolio in line with both the housing and economic needs of the borough.
In addition to this, we are diversifying from building homes to places of work, and we have a 45-unit industrial scheme in for planning in Skelmersdale, West Lancashire Borough’s largest town, a former farming and coal mining town whose urbanisation and development coincided with the national growth in new towns in the late 1960’s and 70’s. As one of our target areas we want to retain a thriving town centre with high-quality homes and the opportunity for permanent jobs for the people of Skelmersdale and West Lancashire.
Sean Keyes, Managing Director of Sutcliffe’s
Sutcliffe is a multi-disciplinary firm of structural and civil engineers who have been established for 35 years. Their core services are, Structural and Civil Engineering, Geotechnical and Environmental Investigations, Building Surveying, and Pre-Planning Services.
“Almost three years since the first Covid-19 lockdown, the construction industry is still feeling the effects as well as the wider impact of the pandemic on the economy today. Construction products, materials, and labour costs have risen significantly and reports earlier in the year predicted that the rising cost of materials would be the biggest challenge in 2023 prohibiting accelerated growth in housing. To summarise the challenges:
- Construction inflation hit 11% in 2022 and is currently 4.6%
- Wage inflation is 7.7%
- Real inflation is 6.7% dropped to 4.6% in Oct 23
- Money is expensive and budgets are effectively being cut.
- Mental health in the workplace and at home
- Training of apprenticeships and graduates
- Early retirement of skilled professionals
- Current perspective of Gen Z
- Procurement of professional services and major projects
- Main contractor’s margins 1-2% or less
- Blame culture.
- Building Safety Act
- Grenfell
- Net Zero
Sean continues; “Nothing is an over-night fix but as a business, we are tackling resilience by way of: Building solid teams who are helping to build more homes, validating costs to ensure the whole supply chain makes a profit, ensuring everyone is reasonably paid, ensuring contracts are not overly onerous, ensuring SME Contractors/sub-contractors are not squeezed too hard to keep the price down, providing mental health first aiders and “Buddies”, having regular reviews and staff updates, offering flexible working and investing in social value and the professional development of our staff.”
The synergy between the speakers Helen Spencer, Sean Keyes, Mark Kitts and Tim Whitehill was evident. All were agreeable on the challenges and each offered a positive solution towards “fixing what is broken”.
These challenges have highlighted the importance of collaboration and partnership within the industry. Companies are now working together more closely than ever before to share knowledge, resources, and expertise, resulting in a stronger and more resilient sector.”
As we move forward, the construction and building industry will continue to face significant challenges, both old and new. But with determination, innovation, and a willingness to work together, there is no doubt that the sector will emerge even stronger and more successful than before.
The Save Construction Initiative is a not-for-profit organisation that also recognises the need to support other charities. Beneficiaries from the event ticket sales were LandAid.
