As one of the leading firms of Chartered Surveyors operating heavily in the development land sector throughout the Thames Valley, we have closely monitored how the development land market has responded to the various political and economic changes that have taken place over the last six months or so.
Haslams’s Steven Smith observed: “…there is undoubtedly some uncertainty with the land market as a result of the EU Referendum but, such is the imbalance in the supply of new houses relative to continuing demand to buy and rent, it would be wrong to suggest that there is any prospect of collapse. We are seeing at this precise moment a slight reduction in land value, especially with the larger sites, and certainly we are noticing less bids per site to be sold in comparison with say 12 to 24 months ago but the feeling is that will not remain the case for long”.
“There is however still a strong appetite for long term strategic land where developers seek to promote the land’s development allocation through the still complex planning system in order to secure a planning permission at some future point. This would suggest that there is still strong underlying confidence in the UK residential market place over the next 3 to 5 years; and arguably longer as a recent survey showed it takes around 9 years to deliver planning permission on a site in excess of 2,000 dwellings”.
He added “…it is clear from talking to a number of the national housebuilders that, while there is still enthusiasm to purchase good oven ready sites with planning permission, the developers are being both selective and showing more interest in acquiring sites which will deliver housing at the lower to middle end of the market. The top end of the market is more problematic where values have dipped disproportionately to the rest of the sector”.
BSc (Est Man) FRICS FCI Arb FCABE