Labour has recently announced it plans to build at least 100,000 publicly funded social homes per year if elected to government.
Brian Berry, FMB Chief Executive, said the figure would help England get closer to its 240,000 homes per year target.
However, he said it was "crucial" that Labour recognises smaller developers will be vital in delivering the volume of new housing needed.
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"Alongside the decline in significant levels of publicly funding house building programmes since the 1980s, we've also seen a decline in the small local house builders," he said.
"In the late 1980s, SME house builders built two-thirds of all new homes but now they build somewhere between a quarter and one third. It's local builders which train the vast majority of construction apprentices. Local firms plough money back into the local economy and are able to provide consumers with real choice when it comes to new homes. Empowering small house builders would therefore not only help achieve our housing targets, it would also provide numerous benefits to local communicates up and down the country."
Mr Berry added: "We would stress that Labour's proposal to lift the borrowing cap on local authorities is a sensible one – if councils are allowed to borrow against their assets and invest in house building, it would empower them to once again launch significant local house building programmes and help solve our ever worsening housing crisis."
(LM/CD)
