The new Labour government has put its money where its mouth is when it comes to its  manifesto pledge to get “Britain building again” as Rachel Reeves revealed plans to invest more than £5bn in housing next year. In her maiden budget, the chancellor announced a number of measures that are intended to boost the government’s target of 1.5 million new homes over the next five years.

The investment will add £500m to the Affordable Homes Programme, taking the total budget to £3.1bn, and there will also be £3bn support to SME housebuilders and the build-to-rent sector by way of housing guarantee schemes. In addition to this, the new chancellor announced that £46m will be allocated to local authorities for the recruitment and training of 300 planners that will allow town halls to respond to applications quicker and bring new housebuilding plans in sooner.

All good so far you may think, but as with any budget not everyone comes out a winner and with this level of investment there is always a price to pay. Second home buyers now face a stamp duty land tax charge increase of 2 percentage points, taking the additional tax to 5%. This could mean that any would-be landlords thinking of snapping up one of the governments new homes as a means of a second income, may have just had that dream scuppered.

The issue of affordability all round is not something that can be ignored as we move into 2025. Rachel Reeves plans to increase government borrowing has inflation knocking at the door, and the Bank of England has already hinted a slower decrease in interest rates, which is not good news for mortgage buyers.

However, the positive news is that the focus on new build does look a promising one and means that housebuilders can look forward to a busy five years. While busy is good, it won’t be without its challenges as the implementation of the Future Homes Standards will undoubtedly see higher upfront costs builders, along with the need to adapt to alternative construction practices.

While lenders confidence to lend on new build property has grown substantially in recent years, now is not the time to become complacent and potentially vulnerable to high losses. This influx of new housing also means that lenders should stay vigilant in limiting their exposure to potential risks when loaning for houses on new development sites.

It is normal for lenders to manage their lending on a new build site. This is where services like our new build exposure risk monitoring can help lenders stay fully informed on new build developments.

We have developed a database of new build developments within the UK, and by using this information our clients are able to monitor the numbers of instructions within developments to assist in managing exposure risk and updating lending appetite.

The database also provides construction information for each of the developments, designed to meet the specific needs of our clients and ensure accurate risk assessment.

As we move closer to the expected explosion of new build, lenders will need to be part of this market for many reasons, particularly where developments have government schemes to help and support those to get onto the property ladder.

Growth is one but new build also offers the right kind of growth as properties come with high energy ratings and lower running costs which will help with the management of back book rating for regulators. There will be stiff competition in my opinion and knowing you are underwriting the right property at the right time for the right reasons will be crucial if you are to avoid accidents in the rush for new build market share.