The Federation of Master Builders (FMB) said 70% of UK builders have seen an increase in prices, with further rises expected. This could have a knock-on effect on the price of homebuilding projects.

Sarah McMonagle, director of external affairs at the FMB, said: “Thousands of smaller building firms are grappling with the rising cost of materials caused by the depreciation of sterling since the EU referendum. More than 70% of smaller building firms have experienced increased costs as a result of the weakened currency, with additional increases of 10 to 15% expected as the new year unfolds.”

A quarter of all materials used by the UK construction industry are imported and the FMB said there are anecdotal reports of increases of 22% for Spanish slate and 20% for timber.

“This is significant and underlines the vulnerability of the industry to sudden fluctuations in the strength of our currency. The combined pressure of higher material prices and the rising cost of skilled labour represents a serious challenge to builders,” added McMonagle.

She said homeowners could start to see the cost of their building projects increase and SME builders will need to cover themselves against sudden price swings.

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“Some builders are attempting to mitigate this by introducing larger contingency funds when pricing for a job, or by stipulating in the contract that the overall contract price will change in the case of material price hikes, making client budgeting more tricky,” she said.