Investment bankers have released a warning to the housing market, suggesting that small house builders need additional financial support if the UK is to resolve its current housing crisis. In the current market, small house building companies are finding it increasingly difficult to access capital in order to begin new building projects.
Leading investment bankers have argued that the larger house builders are too big to utilise the countless smaller opportunities available across the country. Lack of funding to small builders and lack of interest from the larger players has created stagnation in this area of the market.
Alternative Lending Solutions
Throughout the recession high street lenders were wary of lending to builders, this trend has continued and SMEs are still finding it tough to gain access to finance. This has directly resulted in small house builders, SMEs and individuals turning to alternative lending providers as a source of funding.
Here at Wellesley & Co. we lend primarily, but not exclusively, to property developers all across Britain. Each application is assessed on a case by case basis and we avoid the conventional ‘tick-box’ method of applying for finance. Nevertheless, each application must also be approved by the Wellesley Credit Committee which operates a strict credit policy. This is to ensure only suitable applications are approved, examples of Wellesley Borrowers can be seen here.
Cities and Local Government Devolution Bill
We believe small house builders should be given more financial support and the opportunity to contribute towards the resolution of our country’s housing crisis. We want to get Britain building again and therefore we strongly advocate the latest Cities and Local Government Devolution Bill, as mentioned in the Queen’s speech to the Houses of Parliament.
The Cities and Local Government Devolution Bill will see the introduction of directly-elected mayors to combined local authorities across the UK. All housing, transport, policing and planning responsibilities will be passed on to them; meaning more freedom and finance will possibly be bestowed on small house builders.
If you would like further information regarding potential borrowing with Wellesley, please email [email protected].