In 2023, home building in England and Wales generated £53.3bn of economic output and supported 834,000 jobs, according to a new report, the Economic Footprint of Home Building, produced in association with United Trust Bank.
The report states that hitting the new government’s 1.5m homes target could deliver £330bn to UK PLC and an extra 350,000 jobs a year
The research carried out by Lichfields for the Home Builders Federation (HBF) found that last year, delivering 240k homes generated:
- £53.3bn of economic output
- £6.4bn in revenues for the exchequer (via SDLT, Corporation tax, NI, PAYE etc)
- £9.2bn of new ‘affordable’ housing (20% of all new homes are ‘affordable’)
- £1.5bn investment in infrastructure
- £16.6bn spent in the construction supply chain (90% stays in UK)
- £216m investment in open space, community and sport facilities
- And supported 834k jobs including 10k apprentices and trainees
The findings said that if Labour were to meet its housing targets of 1.5 million homes built over the course of this Parliament, this could result in:
- 1,043,000 jobs supported each year, including 10,250 graduate and apprenticeship positions.
- £330 billion generated in economic activity
- £57.5 billion for affordable housing
- £42.5 billion spending in local shops.
- £40 billion in tax receipts, including £3 billion in additional council tax
- £9.4 billion in funding for infrastructure, including £4.2 billion for new and improved schools
- £1.35 billion in spending for open spaces
Compared to the 1 million homes built under the last government, this equals an additional:
- 347,500 jobs each year, including 3,417 graduate and apprentices
- £111 billion in economic activity
- £19 billion for affordable housing
- £14 billion spending in local shops
- £13 billion in tax receipts, including £1 billion in council tax
- £3.1 billion in funding for infrastructure, including £1.4 billion on new and improved schools
- £450 million in funding for open spaces
The home building industry is now urging government to address the other constraints to delivery, particularly on the demand side and is also calling on the new government to deliver on its commitment to find a solution to the ‘nutrition neutrality’ issue holding up an estimated 160,000 homes.
Neil Jefferson, chief executive of the HBF, said: “As well as addressing some of the major social issues the country faces, building more homes drives economic activity. The house building industry sustains hundreds of thousands of jobs, generates huge receipts for the exchequer and boosts investment in infrastructure and amenities across the country.
“Delivering new developments provides energy-efficient, modern homes, and ploughs investment into new roads, schools and community facilities that benefit both new and existing residents.
“If government can deliver on its ambitious housing targets it will reap significant social and economic benefits. The industry welcomes the swift and decisive actions to address the constraints in the planning system, but more is needed to accelerate growth. The lack of affordable mortgage availability means more support for buyers is needed. Creating demand for new homes provides the confidence the industry needs to invest and deliver both private and affordable homes.
“The upcoming budget provides an opportunity for the Government to take more positive steps to address the mounting housing crisis and to commit to their pledge to get Britain building again.”
Adam Bovingdon, head of property development at United Trust Bank, added: “This important report illustrates the huge contribution the housing industry makes to the UK economy and to the local areas surrounding new housing developments. UTB is a staunch advocate for regional housebuilders and entrepreneurial developers and the important contribution they make to delivering the UK’s housing needs. Our funding supports the completion of around 5600 new homes at any one time, bringing new jobs, new facilities and new money to areas where investment can make a big difference.”
Richard Coburn, senior director at Lichfields, stated: “We were delighted to be asked by the HBF to update our series of economic impact work which we started in 2015. Our research lands at an extremely important time for the house building industry with the new government seemingly taking all reasonable policy measures to accelerate much-needed delivery of new homes.
“Lichfields again has identified the very significant economic contribution made by house building and how boosting supply to achieve the government’s confirmed aspiration of 300K homes per annum in England will not only help improve access to housing for people across the country but also deliver a significant economic and infrastructure dividend.
“It is important that this contribution is properly recognised in planning and investment decisions across central and local government.”