{"id":377192,"date":"2026-01-18T17:09:12","date_gmt":"2026-01-18T17:09:12","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/377192\/"},"modified":"2026-01-18T17:09:12","modified_gmt":"2026-01-18T17:09:12","slug":"labour-housing-plans-in-tatters-as-construction-sector-suffers-worst-slump-since-the-financial-crisis","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/377192\/","title":{"rendered":"Labour housing plans in tatters as construction sector suffers worst slump since the financial crisis"},"content":{"rendered":"

By JOHN-PAUL FORD ROJAS, DEPUTY BUSINESS EDITOR<\/a> <\/a> and HUGO DUNCAN <\/p>\n

Updated: 07:08 EST, 18 January 2026 <\/p>\n

The boss of one of Britain\u2019s largest developers has warned Labour is on course to miss its housebuilding targets \u2013 as figures showed a slump in the sector.<\/p>\n

Berkeley chief executive Rob Perrins said taxes and red tape were holding the industry back.<\/p>\n

And gross domestic product (GDP) figures published by the Office for National Statistics (ONS) showed the construction sector shrank by 1.3 per cent in November.<\/p>\n

Over the three months to November, meanwhile, it contracted by 1.1\u00a0per cent \u2013 the worst performance since March 2023 \u2013 the ONS revealed.<\/p>\n

The figures echoed recent data suggesting the construction sector was in its most prolonged slump since the financial crisis in 2008.<\/p>\n

Housebuilder Taylor Wimpey was the latest to warn of sluggish performance.<\/p>\n

\"Building <\/p>\n

Building slump: Berkeley chief executive Rob Perrins (pictured, left, with Chancellor Rachel Reeves) said taxes and red tape were holding the industry back<\/p>\n

And a Bank of England poll of lenders yesterday showed that demand for mortgages fell in the final quarter of last year at the sharpest pace since the end of 2023 \u2013 and was expected to fall again over the next three years.\u00a0<\/p>\n

It is a far cry from Labour\u2019s \u2018build, baby, build\u2019 mantra and the party\u2019s plan to see 1.5m homes built over the course of this Parliament.<\/p>\n

Berkeley boss Perrins, asked if the Government will hit the target, simply said: \u2018No.\u2019<\/p>\n

On the \u2018housing unpacked\u2019 podcast with Knight Frank, he said the industry was \u2018overtaxed\u2019 while grappling with new regulations such as the building safety levy to fix dangerous cladding and defects.<\/p>\n

\u2018You need to stop bringing in new regulation,\u2019 said Perrins.<\/p>\n

He added that uncertainty over Rachel Reeves\u2019 Budget<\/a> hit housing last year, but was \u2018encouraged\u2019 by signs of life in the market after \u2018an unusually good couple of weeks at the start of the year\u2019.<\/p>\n

Perrins also said: \u2018What is fundamentally important is that we get the feel-good factor back.\u2019<\/p>\n

Meanwhile, Taylor Wimpey said Budget uncertainty had weighed on sales in the second half of last year, spilling over into 2026.<\/p>\n

Chief executive Jennie Daly said: \u2018Demand continues to be muted, particularly among the important first-time buyer category, which will constrain overall sector output.\u2019<\/p>\n

The firm said sale prices were under pressure as building costs rose, meaning profit margins were expected to be lower this year than in 2025.<\/p>\n

Shares fell by as much as 5.5\u00a0per cent on the update before recovering to close just 0.1 per cent, or 0.1p, down at 103.8p. They are down by 15\u00a0per cent since a peak in June last year.<\/p>\n

The update came a day after rival Vistry reported a fall in sales in 2025, saying Budget uncertainty led to a \u2018more subdued market\u2019.<\/p>\n

Earlier in the week, Persimmon, another builder, said that it had built more homes than expected in a \u2018challenging\u2019 market last year, but said it was \u2018not expecting any material improvement in market conditions this year\u2019.<\/p>\n

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\n Labour housing plans in tatters as construction sector suffers worst slump since the financial crisis<\/p>\n