University claims top house builders enjoying "soaring profits"

A university claims house builders are securing “soaring profits” despite the worsening housing shortage across the country. 

Research by Sheffield Hallam's Centre for Regional and Economic Social Research analysed the UK’s nine largest housebuilders between 2010 and 2015.

The nine are responsible for almost half of all new housing starts in the country.

The firms increased their housing output by 33 per cent during part of the time, from 2012 to 2015, but at the same time their revenue grew 76 per cent, with profit before tax rising by 200 per cent in this period.

The research also showed that end of year profits for the biggest five firms (after taxation, impairments and exceptional items were taken into account) increased from £372 million in 2010 to over £2 billion by the end of 2015 - an increase of over 480 per cent. 

Dividend payments to shareholders in 2015 amounted to 43 per cent of yearly profits - this proportion “raises questions about the levels of reinvestment in housing production taking place” according to the university.

“Reliance on the private sector alone is not enough: unless there is also a major upscaling in housebuilding by local authorities, housing associations and other non-profit organisations, the crisis in housing supply will continue” says a spokesman for the research team.