Removing Barriers Could Unlock 100,000 SME-Built Homes Each Year
A new report from the Home Builders Federation (HBF) finds that small and medium sized housebuilders (SMEs) across the UK believe they could deliver an extra 35,000 homes per year, raising their total output to around 100,000 homes annually if key obstacles are addressed.
The 2025/26 State of Play study, produced with Close Brothers Property Finance and Travis Perkins, highlights persistent challenges ranging from regulation and tax to land availability, planning delays and infrastructure constraints.
Survey insights:
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97% of SME respondents say the regulatory or tax environment is a barrier to growth.
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94% cite securing planning permission or discharging conditions as a major issue.
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89% say local authority capacity is a key constraint.
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Other significant barriers include land availability/pricing, utility-connection delays and viability pressures.
Neil Jefferson, Chief Executive of the HBF, said: “Tackling planning bottlenecks and infrastructure delays is essential if SME home-builders are to confidently invest in future land and labour supply.”
He added that, without progress, smaller firms will continue to be disproportionately affected by delays and rising costs, reducing their ability to compete and slowing housing delivery.
Implications for housing delivery
On the demand side, 84% of SMEs highlighted the importance of supporting first-time buyers, underscoring ongoing affordability pressures and the need to stimulate activity at entry level.
A stronger SME base would help diversify both the market and the types of sites brought forward, supporting regeneration and community-led development. If SME delivery rises to around 100,000 homes annually, it would make a notable contribution toward the Government’s 300,000-home ambition and broaden regional supply.
