Change is in the Air

13th June, 2018

The role that offsite manufacture can play in solving many of the UK’s housing problems has never been more prominent. Minister of State for Housing, Dominic Raab, outlines how the Government is taking steps to stimulate and encourage the greater use of offsite methods.

Since I became Housing Minister in January, I have been struck by the enormous opportunities to be far more innovative in the way we build new homes. From Tokyo to Stockholm, countries across the world are using new technologies to increase housing supply and deliver high quality homes. If we want to achieve our ambition to be building 300,000 homes a year and deliver homes that are fit for the future, then we must make sure we are at the cutting edge of this innovation. For too long, productivity and innovation in construction have lagged behind other industries. So, modern methods of construction (MMC) are a chance to change that, creating capacity in industry to build more homes, deliver greater economies of scale, and putting quality at the heart of the building process.

For consumers – whether renting or buying – these innovative practices can offer better homes, lower energy bills, fewer maintenance issues, smart technology as standard, and a much greater choice of design. Back in February 2017, the Government’s Housing White Paper recognised the potential to diversify the market and we have been actively implementing the commitments we made. Earlier this month, I heard from our MMC working group about their proposals to increase confidence in products, ensure homes built using new technology can access insurance and mortgages, and support the uptake of MMC across the housing market. This brilliant group, chaired by industry expert Mark Farmer, is developing a unified quality assurance scheme for assessing these technologies to guarantee acceptance of the final homes for warranty and mortgages. The working group has made great progress in its first few months, and is aiming to be in a position to launch the scheme later this year.

This work is a key part of making sure that as use of offsite construction expands, quality remains at its heart. We need to stay vigilant in agreeing and enforcing technical standards, ensure we are not stifling innovation, and support smaller builders as well as larger developers to harness new technology. I hope this scheme will build confidence across the sector and open up mainstream mortgage finance and building insurance availability. We are also providing finance for developers using MMC. Our £3bn Home Building Fund offers finance to these builders, in addition to custom builders and new entrants to the market. So far, more than £120m of loans have been agreed for projects using MMC. The Chancellor’s Autumn Budget added a further £1.5bn to the Fund, specifically targeted at supporting small and medium sized builders who cannot access the finance they need to build. I have been told by many in the offsite industry that the number one factor to expansion is a clear and visible pipeline of demand. As Government, we have started to take steps to address this, including by encouraging the growth of sectors of the market that make greater use of MMC, such as Build to Rent and custom-build.

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27 March 2019

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