The Federation of Master Builders (FMB) has launched an updated Developers’ Guide – sponsored by United Trust Bank and OpenReach – to help small and medium-sized (SME) builders step into housebuilding and scale successfully in a market where their contribution has declined sharply. The guide’s release comes as the UK continues to fall behind on its target to deliver 1.5 million new homes by 2029, requiring an average of 300,000 homes a year – a level not seen since the 1960s.
SME housebuilders now account for just around 10% of new homes built, down from 40% in the late 1980s. The Government estimates that recent proposed planning reforms could enable an additional 170,000 homes by 2029/30, but success will depend on revitalising smaller builders’ role in housing delivery.
Overcoming barriers to SME-led growth
The FMB’s most recent House Builders’ Survey reveals that systemic challenges are still holding small firms back from delivering more homes:
Planning: Over 50% of SME house builders say the planning system is the biggest barrier to delivery, while only 11% feel their local authority is efficient in processing applications.
Land: 60% report that access to small sites is poor or very poor, with high land prices and competition from large developers restricting opportunities.
Finance: 42% cite access to finance as a major barrier, often relying on personal funds or small lenders.
Many builders say they would diversify into affordable and community-led housing if these barriers were reduced.
Practical, updated guidance for 2025
Against this backdrop, the 2025 Developers’ Guide provides builders with the most comprehensive and up-to-date resource yet for making the transition into housebuilding. Designed to demystify the process and help SMEs overcome the challenges around planning, finance, and land access, it offers step-by-step guidance from feasibility through to completion – giving smaller firms the best possible chance of building successfully and profitably. Key updates include:
Smart Construction & Digitalisation: Expanded guidance on modern methods of construction and the use of digital tools.
Land & Due Diligence: Stronger focus on assessing site conditions, building local credibility, and managing contaminated soil.
Finance & Investment: Coverage of the forthcoming National Housing Bank and National Housing Delivery Fund (from 2026), alongside advice on using digital platforms and the Green Homes Alliance for energy-efficient projects.
Planning: Guidance reflecting the National Planning Framework 4 (Scotland), clearer explanations of developer contributions, financing risks, and a new boxed section on post-planning hurdles.
People & Skills: Signposting to CITB’s New Entrant Support Team (NEST), GoConstruct Careers, and new masterclasses for workforce development.
Sustainability & Building Control: Updates covering the Future Homes Standard (2026), the Home Energy Model, Biodiversity Net Gain (BNG) exemptions for small sites, and the transition to “registered building control approvers” under the Building Safety Regulator (BSR).
Case study: From builder to developer
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From left to right: Tom Hossack, George Hanson, Jordan bell, Kev Wilson, Rob Beales, Nathan Pearce, Trinity Johnson, Daniel Morgan, Danielle Hayes and Claire Myers
Kev Wilson, Director of Kev Wilson Builders Ltd and winner of the Northwest House Builder of the Year award, has seen first-hand the challenges and opportunities that come with moving from builder to developer. After years of running a successful construction firm employing twelve staff and taking on apprentices annually, Wilson partnered with an investor to build affordable housing and flats – an experience that taught him valuable lessons about the realities of small-scale development in today’s market.
“My biggest piece of advice to any builder thinking about becoming a developer is: do your homework and question everything. We naively bought a plot of land that came with planning permission and just built what it said, when we should have challenged it and changed it to maximise the opportunity. We essentially broke even on what should have been a profitable project. If I was doing it again, I wouldn’t do anything the same. Before you start, get everybody contracted in on a fixed price so you know exactly what you’re going to make before you begin.
“Don’t rush in – really scrutinise the planning, challenge it if needed, and make sure the numbers stack up properly. I genuinely believe that if you’re looking at anything under £300,000, you’re not going to make any money in today’s market because land is expensive and all the regulatory requirements.”
On what he wants from Government, Wilson added:
“I’d be happy if the Government knocked on my door today and said, ‘Can you build me an estate with ten houses on and I’ll give you a twenty per cent margin on your cost?’ I’d be there Monday morning. We’ve got the trades out there, we’ve got the smaller companies that would do that work with passion, but we need to make a profit to keep the business viable.
“The bigger developers won’t build affordable housing unless there’s some sort of subsidy because the margins aren’t big enough for them, but smaller builders like us would absolutely do it if there was proper support. We’re not short of £400,000-500,000 houses everywhere; what we’re short of is anything from £180,000 to maybe £250,000, and those houses won’t get built by the big developers without incentives.”
FMB President Chris Carr said:
“There’s nothing more disappointing, or frankly, more saddening to me than seeing the decline of small housebuilders in the UK. Back in the late 1980s, small builders delivered over 40% of new homes in this country. Today, that figure has fallen to less than 9%. That’s not just a statistic, it’s a sign that something has gone badly wrong.
“We need to change course, and we need to do it together. This isn’t just about economics or market share, it’s about reviving a tradition, opening doors to new talent, and ensuring local trades and small developers have a place in shaping the communities of tomorrow.
“But let’s be honest, it’s not as easy as it used to be. Finding land is tough. The planning system is complex and frustrating. Then there’s meeting new building regulations and marketing the homes. It’s a mountain to climb, especially for those just starting out.
“That’s why this guide has been created by small and micro developers, for those looking to take their first steps into small-scale housing development. Written in plain English with no jargon, it breaks the whole development process down into clear, practical stages – from site finding and planning to construction and sales. If we want a thriving, diverse, and resilient housing sector in this country, we need small builders back in the game. This guide is here to help make that happen.”
Adam Bovingdon – Head of Property Development – United Trust Bank, concluded:
“United Trust Bank is delighted to sponsor this important guide championing the next generation of local house builders and developers. The UK needs more quality homes delivered by skilled SMEs rooted in their communities, and we believe practical, no-nonsense guidance like this can help talented builders take that confident step into housebuilding. For those already on the journey, we hope it supports you to scale sustainably, building stronger businesses, creating local jobs and nurturing future skills.
“UTB has a long track record of backing ambitious SMEs with responsive funding and specialist expertise. We have become long term partners to many small developers, supporting their ambitions and helping them to evolve into substantial regional housebuilders, and we’re committed to helping this vital part of the sector thrive. We look forward to seeing this guide inspire new entrants and empower smaller participants to grow into the successful developers of tomorrow.”
