Professional services company KPMG has advised UK housebuilders to diversify their debt, as they could face the possibility of shutting off vital access to finance.
The warning came shortly after it was publicized that more than 80% of UK housebuilders’ estimated £10 billion worth of debt is held by just five high street banks.
The National Federation of Builders (NFB) said it appreciated the importance of helping housebuilders diversify their debt, but also thinks that more should be done in promoting alternative finance products to construction SMEs so they can successfully diversify their debt.
According to the British Business Bank (BBB), awareness of different finance products is decreasing, with 38 per cent of SMEs going to their main bank when needing a loan between 2016 and 2017.
Paul Bogle, head of policy and research at the NFB, said: “SME housebuilders have close ties with their local communities. They build homes more quickly and to a higher quality standard than major house builders. Unfortunately, they still struggle to access finance in order to build more homes.
“That is why ensuring that SMEs are made more aware of alternative finance choices is vital to tackling the housing crisis and getting Britain building.”
The above was compiled by Planning Magazine, L. Edgar
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