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Government Injects £100M to Help Fund Small Builders

The Government has announced a £100 million fund to help small builders who complete an average of between 10 and 100 homes per year.

The announcement was first made by Housing Minister Brandon Lewis last Monday and the initiative known as the Housing Growth Partnership is intended to recognise the importance small house builders play in the economy.

The finances for for the £100m cash boost have been provided by an equal partnership between the government and Lloyds banking group who will contribute £50m each.

The fund will be used to help smaller builders grow their business by recruiting and training skilled workers in their area and helping them invest in new home building projects. Aside from the financial investment the partnership is set to create a network of experienced builders and developers who can play the role of mentors for smaller firms who are looking to expand.

The support for small builders comes at an ideal time. In the last 25 years there has been a significant drop off in the number of small builders completing between 1 and 100 units a year.

In this time period the figure has fallen from over 12,000 to fewer than 3,000.

The housebuilding industry has been seeing good growth over recent months and confidence has been boosted by an improvement in the wider economy.

The most recent housebuilding figures show new building starts have doubled when compared with those seen during the financial difficulties in 2009.

Starts and completions have also risen year on year since this time in 2014 and the number of homes successfully gaining planning permission are at an 8 year high.

The Housing Growth Partnership hopes it can help smaller builders take advantage of this industry resurgence, get them building more new homes and help them contribute to solving the current housing shortage in the UK.

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The government has already placed significant emphasis on housebuilding and helping people own their own homes. The partnership plans to arrange approximately 50 investments to small builders which it hopes will translate into an additional 2,000 homes. The Housing Growth Partnership is designed to only support residential developments with a total value of between £0.75 million and £12 million. The investments made will range from £0.5m - £5m per project. The scheme is seen as a way to provide the homes communities want and create additional jobs in the construction sector.

Housing Minister Brandon Lewis said that after the economic crash companies were starting to get back on track and that the government was determined to provide the help they need to grow further. Mr Lewis said:

The 2008 economic crash devastated our army of small builders, with delivery falling from 44,000 homes to just 18,000.

Access to finance is one of the biggest challenges they face – so that’s why today I’m launching this £100 million commitment which will help our smaller builders fund new projects, expand their businesses, create more jobs and build more homes. With housing starts at a 7-year high and climbing and homes granted planning permission at 261,000 – the highest since 2007, this work will ensure we maintain this momentum and keep the country building."

 

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