UK builders suffer from brick shortage

Industry feels the burden and warn it would be ‘ five to seven years’ before it could meet targets

Abrick shortage is stymying efforts to build more homes in the UK. Steve Morgan, Chairman and founder of Redrow, the FTSE 250 house- builder, has also complained of a lack of skilled labour and cumbersome planning laws, warning it would be “five to seven years” before the industry could hit targets of building 200,000 homes a year.

Latest figures show just 118,720 homes were built in the year to April 2013, although housebuilders say they have cranked up production more recently to match soaring demand.

But Morgan said housebuilders are struggling with “capacity issues relating to materials and labour”.

He said politicians should “put a cold towel around their heads” and review strict green belt planning restrictions, which is preventing newhomes from being built on “tatty land”. “There’s some tatty land on the edge of major conurbations which is deemed to be sacrosanct,” he said. “I think that’s wrong.”

2020 target

The Labour Party has pledged to set a target of building 200,000 homes a year by 2020 if it wins the general election in May. But Morgan said: “This is not a tap you can turn on and off. What has restricted output over decades is very restrictive planning policies which started appearing in the 80s and 90s and got worse in the 2000s.”

But Morgan said there is an even more fundamental problem thwarting housebuilders, with not enough bricks being made to keep up with demand fuelled by the government’s ‘ Help to Buy’ scheme. “Bricks is an industry that takes a longer time to wind up. Firms are reluctant to do it until they think it will be worthwhile.”

The production of bricks slumped during the financial crisis as the housing market ground to a halt, with a huge stockpile of 887 million bricks building up in 2009. Brickmakers were forced to close down or mothball factories, with Sussex- based Michelmersh closing down plants in Telford and Buckinghamshire. Kick- starting production has been a slow and expensive process. As the housing market has bounced back, these bricks have been rapidly used up, with stocks at a record low of 336 million.

Martin Warner, boss of Michelmersh, described the target of building 200,000 homes a year as “very aspirational”. He said: “Brick making halved very quickly during the financial crisis. There was 30 weeks of bricks sitting in the countryside. They don’t go off like fresh flowers or fruit. A lot of capacity has gone out of the industry— but it’s going to take a long time.”

The comments came as Redrow revealed it has been given a huge boost by the Help to Buy Scheme but said the housing market has started to return to “normal”. It completed 3,597 houses during the year, up from 2,827 in the previous year.

The first phase of the scheme available only for buyers of new build houses drove 27 per cent of private completions, it said. But Morgan explained that the scheme was proving less popular this summer than in 2013. He also said the Bank of England’s decision to introduce newrules to help curb the surge in the UK’s housing market and limit mortgage lending has “moderated” the market.