Builders and property owners feeling the pinch

Recent research by the Federation of Master Builders (FMB) has found that a third of small building firms are struggling to break even due to soaring material prices.

Almost a quarter have had to pass these price increases onto consumers with more than one-in-ten builders making losses on their building projects due to the rapid price increases.

Following last year’s EU referendum, construction SMEs have reported the widespread increases since the depreciation of sterling.

The increases will hit not only those looking to buy new-build homes, but anyone thinking of extending their house or planning a loft conversion.

Major suppliers are raising the price of key products across the board, with some loft insulation material up 12%, some plasterboard up 10%, and some MDF and chipboard up 7%. The biggest increase is on timber, with some items subject to price rises of 35%.

On average, industry sources said the price rises for timber were 10%, while sand and aggregate were up by 5%. By contrast, the general Consumer Prices Index measure of inflation showed an annual rise of just 1.6%.

What's the solution for homeowners?

Brian Berry, Chief Executive of the FMB, said: 'Material price spikes aren’t just a problem for builders – they’re also a problem for the home owner, with almost one quarter of builders saying that they have had to pass on price increases to their clients.

'This means that building projects now cost significantly more than they did this time last year. What with stagnant wages and price inflation across the economy, consumers are feeling the pinch and it might be that they decide not to commission that loft conversion or extension after all.'

'Or worse still, 85% of builders believe that home owners will be tempted to hire rogue traders who are quoting a lower price than a professional building firm such as those that belong to the FMB.

Hold out for a good builder

'If that’s the case, material price rises could lead to a flurry of botched jobs and distressed consumers. We’re calling on home owners to hold their nerve – they’re better off commissioning a more modest project from a professional builder than a high spec project from a cowboy. Don’t take the risk.'

LABC agree and would always advise that house holders find out as much as they can about the builder they choose. This can be done by asking for references, addresses of previous jobs and membership of Trade Bodies like FMB.

Always get several quotes for the work, be wary of anyone who asks for up-front payment and make sure your local building control team visit site.

How to avoid cowboy builders (and how LABC can help)

Wise words...

Over 150 years ago John Ruskin, an English social reformer said ‘It's unwise to pay too much, but it's worse to pay too little. The common law of business balance prohibits paying a little and getting a lot - it can't be done.'

'If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.’ Sound advice that has stood the test of time.'

Have you been feeling the pinch? We'd like your views in the comments below.

Further information

Find out more on the FMB website.