BDA challenges claims of house building danger
A joint NAEA and Cebr report claims UK house building will suffer hardship in the wake of the EU referendum, but the BDA has disputed its findings. Khai Trung Le reports.
The UK’s housing deficit has been estimated at around 264,000 units in a joint report by the National Association of Estate Agents (NAEA) and Centre for Economics and Business Research (Cebr), and will require 1.4 billion bricks to fulfil. However, the report claims that lengthy waiting times and the potential impact of the EU referendum on European brick supply may jeopardise attempts at new housebuilding. The BDA has challenged the findings as ‘out of date and unhelpful’, pointing to a number of increases in delivery and house building throughout 2016.
The report notes that the partial recovery of brick stock in 2013–14, following the steep decline between 2008–13, meant two-thirds of construction SMEs faced two–month waiting periods for new brick orders. 25% of construction SMEs waited up to four months and 16% received orders after six–to–eight months. With 85% of imported clay in 2015 coming from the EU, the NAEA/Cebr report asserts that Brexit will have an adverse impact on the availability of bricks in the UK, despite the average number of bricks in each home reducing from 5,408 in 2006 to 5,180 in 2016.
There was also brief mention of the skills shortage, speculating that the vote to leave the EU will impose greater restrictions on foreign workers coming into the UK and compromise the UK’s ability to meet its new build targets.
Mark Hayward, Managing Director of the NAEA, commented, ‘We all know that the massive lack of supply in housing is an issue that needs resolving urgently […] it’s crucial we have the right materials and skills to do so. It seems a simple consideration but the fact that we don’t have enough bricks to meet demand has a very real effect and holds up the process from beginning to end. We’re concerned that the impact of the EU referendum means this problem could get worse as we rely on the import of brick components from the EU and, of course, many of our skilled labourers come from there too.
‘Until this is addressed, we might as well resign ourselves to a lifetime of astronomical prices and falling levels of home ownership.’
However, the BDA has responded to the report, with CEO Andrew Eagles saying, ‘The report citing a brick shortage is based on data from April 2015. This is 15 months out of date. It is misleading and damaging for the brick construction industry.’ Citing comment from the Construction Products Association, Builders Merchants Federation and ‘major house builders’ that they have not experienced any issues with brick supply in the past 12 months, Eagles noted that ‘in the second quarter of 2016, deliveries have been 10.4% higher than in the first quarter. The deliveries in June are also 7.4% higher than the figure predicted in May.’
Q2 production of bricks in the UK has also increased by 10% over Q1 2016 to almost 2 billion, according to figures from the Office of National Statistics, around 30% higher than in 2010.
The BDA specifies the correlation of these figures with recent positive news in the house building industry, with 41,222 new homes built in the UK in Q2 2016, seeing a 1% increase over Q2 2015 and the highest number of new houses built since Q4 2007.
Eagles added, ‘The challenges the brick industry faced in 2014, when there was a dramatic increase in house building, are now behind us and the industry is confident it can meet the growing demand for its products in housing and other construction projects.’