The Housing Secretary Angela Rayner MP has today announced a major shake-up of the planning system, with changes designed to make life easier for small, local builders.
We have been pushing for changes to help the nation’s micro and SME house builders thrive and today’s announcement is a sign that the message is cutting through with the most senior decision makers in our country.
Forty years ago, SME house builders delivered 40% of our homes. Today, this figure is around 10%.
The Government have unveiled a range of new measures to cut red tape, free up land, and improve access to finance, all helping small and medium-sized builders to get on with building the homes the country needs. There is still more to be done, such as the need to look again at the current site allocations of just 10% for SMEs in local plans, however, today is a positive step forward.
What’s changing?
Quicker planning decisions for small sites
Developments of up to nine homes will now go through a simpler and quicker planning process. Instead of waiting months for a planning committee to meet, decisions will be made by expert officers, meaning less time stuck in limbo and more time building.
Biodiversity Net Gain (BNG) rules, which we know many builders have found confusing and costly, will also be eased for these smaller sites.
New category for medium sites
Sites between 10 and 49 homes will now be treated differently from large developments. These ‘medium sites’ will face fewer rules and lower costs – including a proposed exemption from the Building Safety Levy – making them more viable for small builders to take on.
More land for small builders
We know from the 2024 FMB Housebuilders’ Survey that one of the biggest challenges builders face is lack of viable and available land. It’s welcome news that Homes England will release more land specifically for SMEs.
A new pilot scheme will also be trialled in Bristol, Sheffield and Lewisham to help unlock small plots that would otherwise be left unused, and we will be following how this progresses closely.
Better access to finance
To help with the costs of getting started, the Government has promised £100 million in SME Accelerator Loans, plus a new National Housing Delivery Fund to improve long-term finance options. This means more builders will be able to secure the funding they need to grow and take on more projects.
What this means for SME builders
These reforms should make it quicker, cheaper, and more practical for small builders to get sites approved and get building. The Housing Secretary has said that the aim is to boost the number of homes being built, create more jobs, and make it easier for first-time buyers to get on the ladder, with small builders at the heart of it.
Since last year’s election the Government have talked a lot about their plans to get Britain building again, but it is vital they recognise small builders as a vital part of the solution.
Making sure your voice is heard
We have long been calling for more to be done to diversify the housing market away from a small number of volume builders, and for the Government to take serious steps to reform the planning system to allow small builders to deliver the homes we need. Today’s announcement represents major progress, but there is still plenty more to be done.
Convincing the Government to deliver these changes has only been possible with our members' support.
By completing the FMB’s annual Housebuilders’ Survey and State of Trade Surveys, by supporting and contributing to our research reports and events, and by backing our campaigns, members have helped demonstrate once again that the FMB is the leading voice of micro, small and medium-sized builders across the UK – and the Government are hearing that message.
We are grateful for your ongoing engagement, as we work hard to deliver more in the future!