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Associations plan 41,000 new homes amid capacity warnings

The top 50 biggest housing association developers expect to build a combined 41,000 homes next year, amid warnings the skills crisis could stymie the sector’s ambitions.

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Top 50 biggest housing association developers plot 41,000 new homes - but skills warning tempers optimism #ukhousing

Inside Housing’s annual survey of development activity shows large associations built 35,370 homes of all tenures last year and plan to scale this up to 41,288 next year. L&Q tops the list for completions, with 2,443 homes built in 2017/18, and expected output next year, with 3,236 homes planned.

But the output figures are tempered by warnings that a lack of labour, already exacerbated by Brexit, is making it more difficult to deliver plans. This week Southern Housing said a shortage of workers meant it completed only 197 of the 494 homes it planned.

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Adam Morton, policy leader at the National Housing Federation, said: “A number of associations have told us there is a shortage of skilled labour, which is making it increasingly difficult to find contractors. This is constraining development for some.”

A survey of 100 social landlords by Social Housing for Savills revealed 94% believe Brexit will impair construction industry capacity.

It came as Sir Oliver Letwin’s initial report into increasing the rate of housebuilding said 15,000 extra bricklayers are needed to meet the government’s housing target.

Paul Hackett, chief executive of Optivo and chair of the G15 group of large London housing associations, said: “We are on track with our delivery. But we are experiencing more problems with the supply chain and that’s largely around our contractors and sub-contractors having trouble retaining skilled workers, especially in London. It’s a combination of an ageing and retiring workforce, a weak pound, and yes, the Brexit vote.”

Mark Farmer, director of Cast Consultancy, who produced a report for government on construction industry capacity in 2016, said he thought associations would struggle to hit their development targets due to capacity constraints.

“That will be a big uplift and something the existing skills and labour resource will struggle with,” he told delegates at Housing 2018 in Manchester this week.

Asked about post-Brexit capacity by Inside Housing this week, Leave-voting housing minister Dominic Raab said modern construction methods would help “reduce our over-reliance on cheap labour from abroad”.

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