State of Play 2025: Unlocking SME potential to deliver 100,000 more homes

Today we launch the 6th State of Play Report, in partnership with the Home Builders Federation (HBF) and Travis Perkins, shining a spotlight on the key barriers and opportunities facing SME housebuilders across the UK.

The Big Opportunity

Our research reveals a striking insight: if these barriers were removed, SMEs say they could build an additional 100,000 homes, a 56% increase in output. This is a game-changing figure for tackling housing shortages and driving growth in local communities.

What’s Holding SMEs Back?

The report identifies critical challenges that continue to restrict SME housebuilders, including:

• Planning delays - lengthy processes that stall projects and increase costs.
• Skills shortages - gaps in labour and expertise impacting delivery.
• Material supply constraints - rising costs and availability issues.
• Regulation and political challenges - stifling output of SMEs and barriers to growth over the coming year

Why It Matters

SMEs play a vital role in creating diverse, high-quality housing and supporting regional economies. Removing these barriers would not only boost housing supply but also:

• Create thousands of jobs.
• Stimulate local supply chains.
• Enhance competition and innovation in the sector.

Key Findings from the report

• 97% say business taxation and the regulatory environment are barriers to the growth of their business in the next 12 months.
• Financial pressures were a big barrier, with 64% citing cumulative viability pressures and 58% citing difficulties obtaining offers for S106 Affordable Homes.
• Regulatory and political challenges remain significant barriers; 66% report local or political opposition, 55% Biodiversity Net Gain and 54% the Building Safety Levy.
• 94% of SME builders cite securing planning permission or discharging conditions as a major issue.
• 89% of SME builders view Local Authority capacity as a major constraint
• Land and infrastructure issues also continue to limit delivery, with 54% citing land prices, 39% citing land availability, and 49% the costs/timescales for utilities provision
• Construction and supply challenges are notable but viewed to have less impact with 43% citing labour/supply costs and 41% cost of materials as major barriers to growth. While 67% of respondents said the supply chain and materials availability were a barrier to growth, only 10% said it was a major barrier.

Read the Full Report

Explore the full findings, data, and recommendations in the State of Play Report 2025. Together, we can unlock the potential of SME housebuilders and deliver the homes Britain needs.

State of Play 2025/26