The guide — developed in collaboration with the Department for Levelling Up, Housing and Communities (DLUHC) — offers an overview of the financial products available to SMEs and the application process for these options.

As the number of homes delivered by SME housebuilders has been declining over the years — with SMEs responsible for the construction of around 10% of UK homes today, down from 40% in the 1980s — the FMB and UK Finance hope that the guide will help more developers access finance and subsequently reverse this trend.

Brian Berry, chief executive at the FMB, said: “We know that development finance has often held small builders back, with 29% of FMB members citing it as a barrier to building new homes.

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“The aim is that this document helps small builders through this complex, but important part of the development process.

“If we are to deliver more homes for the nation, then small local housebuilders must have barriers removed to help them deliver, and I hope this guide goes someway to aid them in this process.”

Stephen Pegge, managing director of commercial finance at UK Finance, commented: “Finance is a critical element when planning a small-scale housing development and lenders are committed to supporting builders access the funding they need.

“This guide has been created for small, local housebuilders to ensure they have the knowledge and guidance on the steps to take to get financial support.

“There are a wide range of finance options available, all of which could help builders undertake a larger project than their own cash would allow, in turn helping them to build homes and boost local economies across the country.”