Claims by estate agents that houses prices are rising excessively because of a shortage of bricks have been rubbished by brick producers themselves.
The Brick Development Association, representing brick manufacturers in the UK, has described a report1 from the Centre for Economics & Business Research (CEBR) for the National Association of Estate Agents as “out of date and unhelpful”
According to the estate agents’ report, “a shortage of brick supply has been a contributing factor in rising house prices over the past decade, as growing demand continues to outstrip availability of housing. Even with willingness from contractors to build homes following Brexit, the UK’s construction sector would require a total of 1.4 billion bricks in order to resolve the housing shortage in the UK”. This is the equivalent of the total amount which would be needed to build all the houses in Leicestershire, the report says.
The report states that two-thirds of small and medium-sized construction businesses faced a two-month wait for new brick orders last year, with almost a quarter waiting for up to four months and one in six (16%) waiting six to eight months.
Mark Hayward, managing director of the National Association of Estate Agents (NAEA) said: “We all know that the massive lack of supply in housing is an issue that needs resolving urgently. As well as freeing up more land to ensure we can build the right sort of houses in the right places, it’s crucial we have the right materials and skills to do so. It seems a simple consideration but the fact that we don’t have enough bricks to meet demand has a very real effect and holds up the process from beginning to end. We’re concerned that the impact of the EU Referendum means this problem could get worse as we rely on the import of brick components from the EU and of course many of our skilled labourers come from there too.”
However, brick manufacturers said that CEBR was relying on out-of-date numbers and the picture had now significantly changed.
Andrew Eagles, chief executive of the Brick Development Association, said: “This is a lazy analysis. The BDA represents 99% of the brick manufacturers in the UK. We can report with absolute authority that there is no shortage.
“There has been a significant increase in brick production over the last 15 months and this is confirmed by the ONS statistics. The Construction Products Association, Builders Merchants Federation and major house builders also confirm that they have not seen any issues with brick supply in the last year.
“The report for the NAEA citing a brick shortage is based on data from April 2015. This is 15 months out of date. It is misleading and damaging for the brick and construction industry. I find it astonishing that the CEBR felt it useful to release a report that was so out of date.”
He added: “The challenges the brick industry faced in 2014 when there was a dramatic increase in housebuilding are now behind us and the industry is confident it can meet the growing demand for its products in housing and other construction projects.”
Manufacturers increased production by nearly 10% last year to almost two billion bricks to meet the growing demand. This will be more than 30% higher than in 2010.
In the second quarter of 2016, deliveries have been 10.4% higher than in the first quarter. The deliveries in June are also 7.4% higher than the figure predicted in May. These changes are significant, the BDA said, and point to the increased demand for bricks in the housing market, and other sectors.
These results also correlate with statistics that show that 41,222 new homes were built in the UK in Q2, which is a 1% increase on the same period in 2015. This is also the highest number of houses built since Q4 of 2007, the BDA noted.
1. The NAEA’s Brick Campaign report can be found at www.naea.co.uk/media/1044993/bricks-report.pdf
This article was published on 25 Aug 2016 (last updated on 25 Aug 2016).