The Monday interview: Galliford Try's Greg Fitzgerald says we're in the middle of a housing crunch Fitzgerald does not see all his rivals doing the same. A lot of people are not necessarily selling. They're sat on bits of land where they are going to lose money or make not very much money, or it will affect their margins. The industry veteran, who has been with the company through various incarnations for more than 30 years, clearly thinks this is a mistake. He would rather take the pain now and invest whatever cash comes in than hope for some elusive market pick-up which would finally make the numbers for those older sites look attractive. We've sold those houses and therefore brought the money back in. It's a problem gone, as opposed to a problem that is going to be around for quite some time, if there isn't any housing inflation," he says. "And I don't particularly see any real house price inflation for, I'd never say 'never," but for a number of years." How many, exactly? I don't see any house price inflation for at least three, probably longer. Why would there be? Well, because your industry is now the focus of government efforts to get the economy moving, from the state-backed mortgage guarantee NewBuy, to the relaxation of planning rules around providing affordable housing. "I think we will, over time, because of government stimulus - which will be welcomed - build more houses, [but] that won't do anything for prices," he replies. If anything, on the margin, it will keep them where they are, even reduce them slightly. The Government aren't interested, and quite rightly, in housebuilders making more money. What they're really interested in today is how can we get these bloody builders, whether they're contractors or housebuilders, to put one brick on top of another more than they're doing at the moment. To that end the Government is targeting initiatives not just at housebuilding, but also wider construction. But Fitzgerald sounds rather less positive about infrastructure projects. A large scheme like Crossrail, great, but that doesn't really help people in the South West or the Midlands. Rather than spending £20bn on that one spot over there, they'd be better off spending twenty £1bns around the country. He should know, as Galliford Try is fairly unusual in that it also runs a construction business - albeit one that it is has been scaling down in proportion to the more profitable housing arm. The dual model works, however, he says. If you can keep the two together it makes a huge amount of sense. We get a lot of our [housebuilding] land from our contacts in construction. Plus it can help to ride out slumps, since housing goes into, and exits from, a downturn before construction, he says. And for the million-pound question, what will make house prices move one way or the other? Don't hold your breath for talk of economic recovery. No, it is more the housing shortage which Fitzgerald sees finally offering a fillip to prices, which are stagnant outside various high-end hotspots in London and elsewhere. The maths, as he works it out, is straightforward: the Government has said that up until 2030 this country needs to build 240,000 units a year to meet its housing needs. Even in the good times, the industry was building far less. "Leading up to 2007, 2008, we were always 50,000 to 60,000 short per year," he says. Today we are probably building 115,000. Every year that goes by, the shortage in supply is becoming worse. So is a crunch point coming when we are all huddling under bridges and living 10 to a room? "I think there's a crunch point at the moment," says Fitzgerald. But it's being hidden by the fact that the mortgage availability isn't great. But while financing - or the lack of it - is seen as the industry's biggest problem, the other big bugbear is the planning system. Like all housebuilders, Fitzgerald has complaints. The new planning system, which hands local authorities more autonomy over applications, is seeing many areas "managing planning by appeal," he says. You get a recommendation for approval by the officers and the councillors are turning it down, probably knowing in their heart of hearts that Galliford Try or whoever will win at appeal. The delay adds months to the process, tying up capital, he says. Rather than scrapping the new system, he wants more planning inspectors to speed up the appeal process. But he does see a conflict between the strategy trumpeted by the Government and decisions made closer to the ground. While on a macro level there is political support for the industry, "when it actually comes down to a micro [level] or where they [MPs] actually sit, you're not getting that support through at the same kind of level. It's not a vote-winner. It sounds a tough life, being a housebuilder - record annual results or not.