From banking to building, this week on PropCast we are joined by Homes England’s Innovation Lead Ed Jezeph. With an insight into Homes England’s new bank, modern construction methods what positives there are for the future of housebuilding in England.

Ed starts by saying how excited he is for Homes England to be launching a bank, noting how it is a natural progression for them as an organisation. Whilst the investment directorate within Homes England has existed for over a decade, largely focussed on debt lending and more recently equity investment and guarantees, this has provided Homes England with plenty of experience. Armed with this experience, they’re now launching the National Housing Bank with 16 billion of government funding announced in June 2025 which, Jezeph says “gives us new funding flexibilities.” He acknowledges some in the market may see them as stepping on other people’s toes, but states “we're not here to compete with the market. We're not here to cut the market. We're here to fill in the gaps. We're a lender of last resort. So, when we talk to our customers, as our borrowers on development finance, we want to know why banks won't lend to them.” He continues to concede this does present some challenges, including but not solely ensuring a cash return for the taxpayer of between 6-8%. All of this has impacted on the housing market in a negative way. He goes on to argue, however, that the real return is "to those communities of stuff being built and the impact and the importance of housing and the social value and the wider economic benefit,” and is therefore worth it.

When challenged about Modern Methods of Construction, or MMC, and what went wrong, Jezeph concedes immediately “there'll be people listening to this, possibly rolling their eyes,” and also acknowledges that Homes England were involved throughout, including when L&G put their modular business into administration. Jezeph says the construction skills shortage, which MMC was designed to tackle, was chronic and the government and Homes England responded to the market dynamic to help tackle this. Over a billion pounds was invested into the sector during this period, with plenty of startups full of energy leading the charge. Whilst some will undoubtedly criticise Homes England for investing around £135 million into the sector, alongside £466 million of private capital, Jezeph disagrees. “The smart response should be ‘we should absolutely do it again.’ Because without that sort of funding, innovation isn't going to happen. Fundamentally, the lack of innovation is why we are where we are now, where you've got big listed companies, Taylor Wimpy and others making huge allocations of cash in their annual results to pay for bad buildings.”

This point is further reinforced when considering that the five largest house builders have got about £3.1 billion in building safety issues for legacy buildings. To put into comparison, that is six times the amount of capital that’s been invested into MMC. Jezeph goes on to state that reflection on the failures is needed and that “many of the businesses that closed had business module failure.” There was a huge amount of ambition originally in terms of high-quality homes delivered quickly, more sustainable and more energy efficient, a view not everyone within the sector shares. L&G’s cross-laminated timber approach is often referenced, with planning delays at a handful of sites causing their factory to become unsustainable.

Moving onto more positive topics, Jezeph explains how the United States Department of Housing and Urban Development initiated a research program in 2022 that brought them to the UK, Japan and Sweden to learn about our modular homes. Jezeph particularly focusses on how the English aesthetic plays an important role, stating “you only realise how we’re perceived internationally when you go overseas and you hear those voices of admiration.” Jezeph is then pressed on the next steps, noting multiple schemes that were left empty for extended periods whilst the fire brigade decided whether they were safe or not. He agrees that this was an ongoing challenge with MMC and again highlights some of the problems of innovation: “the London Fire Brigade and the National Fire Council's Chiefs hadn't seen a building of this kind at this height and this scale, particularly post-Grenville before, so understandably they brought a level of scrutiny to that project to build confidence.” Fortunately, developers were often ready for this and provided fantastic digital information to try and smooth this process over. This has been a continued trend, with digital information helping secure gateway progress with the building safety regulator for recent modular student accommodation schemes, a surprise for some within the industry.

Some may ask, why the focus on modular homes? Jezeph argues that this is part of innovation and forward thinking, moving us in new directions. “Fundamentally we've got enough brick capacity, you could build about 170,000 homes a year out of bricks,” he states. “So, if we're going to get to our 1.5 million homes objective over five years, we know we need to build differently. This will either be smaller homes or using less bricks and no one is voting for a smaller house!” Jezeph follows up by arguing we will have to change what we build and how we build it. This includes cross-department work as, whilst their mandate sits within housing, there are other stakeholders involved, such as those with mandates around innovation and engaging new industries who want to make positive changes. Jezeph agrees with the negative views around the current construction labour crisis, arguing that the government announced a £600 million construction skills package in March last year, but this will need supercharging through innovation.

Asked what Jezeph would change about modular housing and innovation, armed with the information he has now. Jezeph said “I’m interested in the project failures, the projects that went wrong, where that interface between the off-site product, the foundations and the traditional groundworks didn't quite work out.” He continued saying “the coordination piece, the technical piece, you know that's the opportunity for us to learn because we know that manufacturing processes deliver quite high-quality products that I think we can take for granted.” He goes on to discuss integration, finding a way to work within the UK’s deeply cyclical housing and construction market.

Jezeph finishes by stating Homes England’s purpose: “We are a housing delivery body. We are here to support as many homes as possible. 40,000 is about what we deliver at the moment, and with our new funding it will be increasing to over 60,000. We will be here to support our partners in the sector and we remain there as a partner to industry and innovation is caught in that.”