Could self-build costs increase?
According to the latest State of Trade survey from the Federation of Master Builders, 70% of UK builders have seen an increase in material prices due to the depreciation of the pound since the EU referendum.
According to the research 70% of smaller building firms have experienced increased costs because of the weakened currency, with additional increases of 10%-15% expected.
Sarah McMonagle, Director of External Affairs at the FMB commented:
“Construction SMEs are already reporting an increase of 22% in Spanish slate and 20% increase in timber. A quarter of all materials used by the UK construction industry are imported “ this is significant and underlines the vulnerability of the industry to sudden fluctuations in the strength of our currency. The combined pressure of higher material prices and the rising cost of skilled labour represents a serious challenge to builders.”
What this means is that self-builders and renovators could start to see the cost of their building projects increase, but is there anything that can be done to mitigate the effect? The Self Build Portal talks to NaCSBA’s self-build representative Peter Johns for his expert opinion:
How will this materials price increase impact on the cost of self-building?
If materials price rises they will be passed on to self-builders, whether they are buying themselves, using a main contractor or going through a package company, unless they have already started and are on a fixed price contract. If the project hasn’t started, I think there will be little self-builders can do to escape price increases entirely (whether the supplier is a manufacturer, importer, package company, they will need to pass on some or all their extra costs).
Should self-builders put off until things are more stable?
Well, that assumes they might get better! Things COULD get worse the pound could fall further; a hard Brexit could mean an even worse shortage of skilled tradesman if immigration rules are tightened. No one has a crystal ball.
Delaying could be good but equally could be worse.
In terms of budget-saving, do you have any advice for prospective self-builders?
Do not skimp on quality structural components – things that are hard and costlier to change later. Where you can save money is on the things like kitchens and bathrooms, or floor coverings – anything that is more temporary or easily replaced. For example, buy a cheap kitchen and save a few thousand pounds with a view to replacing it in a few years’ time. Chances are that once you’ve lived in the house for a while you might want to change the layout anyway.