UK's smaller building companies starting to experience Brexit price hikes
The Brexit effect is having a real impact on small builders across the UK, with material prices increasing markedly, squeezing the margins of those operating across the country.
As a result, building a home is becoming far more expensive. And that's not just for those carrying out the work, as new data has revealed that in many cases, builders are passing the additional costs they face down to consumers.
The findings from the Federation of Master Builders (FMB) show that in the last year, the falling value of the pound has had a severe effect on the costs of bricks and other materials that builders face, thanks to the EU referendum result.
As a result, some 32 per cent of those smaller building firms surveyed by the FMB said they had faced margins that were being squeezed by rising costs. In addition to this, 22 per cent said they had looked at passing on the rising costs of construction to consumers.
Brian Berry, chief executive of the FMB, said: "Material price increases have left builders under severe pressure. This research shows that following the fall in the exchange rate, timber is the material that the majority of builders say has increased most in price but the problem doesn’t end there as everything from insulation to windows to bricks and blocks are soaring in price."
Some builders are now even finding that they are making a loss when it comes to certain projects, largely because of changes in price mid-way through. One in ten said that costs had been absorbed after a quote, leaving them facing higher prices and no profits.
There are fears that escalating costs will mean more people turning to rogue traders rather than working with legitimate building companies in a bid to save a few pounds. In the FMB survey, it was revealed that since the referendum, as many as 85 per cent of small building companies believe this is a real possibility in the future.