The new homes conundrum

Imagine that in July of last year you were deciding on what career to pursue. You may have thought that building new houses sounded like a sure-fire winner. The government had just announced that 3 million new homes needed to be built by 2020 (with 2 million of those to be built by 2016). What's more, they were going to be zero carbon and sustainable, suitable for the environmental problems faced in the twenty-first century and helping to save 15 tonnes of carbon dioxide by 2050. In other words, an exciting and dynamic industry producing not only a much-needed product but doing so in an exciting and innovative way. Sounds like an ideal industry for someone looking for an exciting and varied career.

What a difference 12 months makes. Now is not a good time to be a housebuilder. Significant job losses and redundancies have been announced (at least 5,000 in the last few weeks), share prices are in free fall and, to quote one managing director, "It's sh#t out there and getting sh#ttier by the day and there's no sign of when the sh#t is going to lift."

This raises the very simple question (to which there doesn't seem to be an obvious answer): why on earth has this happened? Although the credit crunch has made finance less available and more expensive, that does not seem of itself to be a sufficient explanation as to why such an industry whose product is in so much demand should be in such difficulties. There is lots of talk of bubbles bursting (which strikes me as a bit too trite to be really convincing) and of the speed of collapse taking everyone by surprise, but I can't be the only one who thinks the whole situation is both desperately tragic and somewhat bizarre.

We live in a country with lots of people, too little space and an inadequate housing stock. We need more (and better houses) and yet our (previously very successful) housebuilding industry is staring over the abyss of what is being decribed as the biggest fall in house prices since the Great Depression.

Caroilne Flint, the Housing Minister, recently announced plans to rejuvenate the sector including 'rent now, buy later' schemes for first-time buyers with a household income of less than £60,000 as well as committing to buying unsold housing from the private sector for affordable homes but concerns remain as to whether this will be enough.

In all of the confusion, one thing is certain. If the country is to have 3 million new homes by 2020, we need people to design and build them. We need our housebuilders to stay in business.