What Does The National Housing Bank Mean For UK Construction?

At the end of March, the government announced the creation of the National Housing Bank, which has been billed as a government public finance institution. 

Its purpose is to support the housebuilding sector to help the government on its road towards delivering the 1.5 million new homes it promised to construct by the end of the first five years of the Labour government.  

The National Housing Bank will “deploy up to £16 billion of debt, equity and guarantees” and aims to help housebuilders access over £53 billion in investment from the private sector in addition to providing public finances to support the delivery of new homes. 

As part of its remit, the National Housing Bank has an investment prospectus, which highlights the products and interventions available to partner organisations, as well as information about how to access support. 

One of the aims for the institution is to support both new companies entering the housebuilding sector and existing small and medium-sized enterprise (SME) housebuilders, particularly in under-represented local markets. 

Many of the debt finance and the equity products are designed to support those operating at this scale. Examples include the SME accelerator loan, low-interest loans for Registered Providers and revolving credit facilities.

There is also a list of eligibility requirements to access support from the National Housing Bank, including being able to show that without funding, projects would not progress or would be significantly delayed. 

What does the picture look like for UK housebuilding? 

In April, some of the UK’s largest housebuilders warned that they are experiencing financial challenges due to a slowdown in the property market and the continued uncertainty caused by global geopolitical events. 

Many have adjusted their projected sales figures down for the year, while also increasing their estimated net debt position. 

All of this points to a challenging period for the construction sector, which is why if you are a contractor or housebuilder, it is important that you prepare for potentially difficult times ahead. 

Among the steps you can take is to work with a construction debt collection agency to ensure that all of your outstanding invoices are paid. This will help maintain your business’ financial stability so that you can continue to operate. 

How does construction debt collection work?

When you work with a specialist agency, you will have a dedicated team working to recover any payments that are owed to you.

The process begins by assessing the claim you want to make, during which a no-win, no-fee payment will typically be agreed enabling us to start work. 

In the first instance, we send demand letters for payment, which are drafted for each debt and tailored to the legal system in which you’re operating. 

If payment is not forthcoming after these letters, we progress to telephone negotiations. These are conducted by your dedicated account manager who has experience in handling such discussions and agreeing a process for payment. 

During this call, our account director will seek to understand why the debtor has been unable to pay, and will work to find a solution that is appropriate for all parties involved. Only if all of these steps are unsuccessful, do we consider legal action.