Theresa May faces challenge as housebuilders step back
The newly appointed Prime Minister faces a stiff task now that large housebuilders aren’t buying land due to uncertainty in the wake of Brexit.
Theresa May moved into Number 10 on Wednesday, and in a speech promised to boost housebuilding, stating that failure to deal with what she termed the “housing deficit” would only result in a further growth of the “divide between those who inherit wealth and those who don’t”.
It is clear however that many housebuilders have either delayed or are re-thinking plans and projects in order to grow their development options.
David Thomas, chief executive of Barratt Developments has said that his firm will “reassess” its acquisition strategy, because of the uncertainty the building sector is experiencing due to the Brexit vote. He said: “We recognise that our land spend would be round about £1bn per year, and therefore it’s just sensible that we look to reassess that land spend and we also monitor the market.”
Barratt is not the only company putting off buying land. It seems to be the majority holding off on committing to any projects. It seems everybody is waiting for things to stabilise before taking any plunges.
Berkeley Group chairman Tony Ridgley thinks that housebuilders are just attempting to take stock of the situation now that Britain is no longer a part of the EU. He believes that May’s new position as PM will provide the stability the market desperately needs. He said: “We need stability, we need political leadership, and I believe she’s got the credentials and the reputation to do that.”
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