A labour and materials shortage is set to slow housebuilding and sustain record price growth, Assetz Capital chief executive Stuart Law has warned.
It comes as Land Registry data revealed annual house price growth hit a record high of 13.2 per cent in June, as buyers rushed to take advantage of the end of the stamp duty holiday.
Law said housebuilders are still facing challenges in keeping up with demand for property, which he claims will keep house price growth high.
“The most significant factor we believe will support growth rates over the next 12 to 18 months is the slowdown in housing construction being experienced at present,” he said.
“Housebuilders across the country are facing a myriad of challenges – including difficulties accessing raw materials, labour shortages, increased transportation costs and the realities of post-Brexit trade – all of which are impacting their ability to deliver much-needed housing stock across the country.
“This slowdown in output, on top of the existing lack of appropriate housing stock on the market at present, will result in increased demand and could push house price growth beyond the record levels seen to date this year.”
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Law said a “streamlined planning process” and “adequate funding” for smaller housebuilders was vital.
“We have received requests for hundreds of millions of pounds worth of loans over recent months as specialist funding platforms step in to fill the void left by traditional lenders,” he added.
“But for housebuilders to truly overcome the challenges they face at present the finance sector as a whole must find more innovative ways to offer support and ensure projects don’t stall going forward.”