Market in Minutes:

UK Residential Development Land

UK Residential Development Land
UK Residential Development Land

8 November 2016, by Lucy Greenwood

Caution prevails in the land market after Brexit vote

■ There is caution in the land market due to uncertainty after the EU referendum across much of the UK leading to falls in land value in some areas.

■ Land values have stagnated or fallen over the last three months according to our development land index. UK greenfield development land values fell by 0.4% in Q3 2016 whilst urban land values increased only slightly, by 0.1% in the last three months.

 

■ Caution from some land purchasers has led to sentiment becoming more neutral and in general reduced the number of bids for sites.

■ However, there are areas of the country where demand for land has been maintained. These include outer London, connected markets in the South and central Birmingham.

■ The central London market is behaving very differently from the rest of the country. It has seen the greatest falls in land value because factors other than the referendum are at play.

■ In central London falling house prices have meant land values for residential development have reduced significantly (8.9% decrease in the last six months, the largest falls seen since 2008/09).

■ Land value for office development in central London have fallen (5.9% decrease in the last six months) due to the risk of occupational demand as a result of the Brexit vote.

FIGURE 1

Land value movements

 
Land value movements

Source: Savills Research

Articles from Market in Minutes: UK Residential Development Land

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08 November 2016

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Caution has led to more neutral sentiment but there are areas of the country where demand for land has been maintained

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Key contacts

Jim Ward

Jim Ward

Director
Residential Research and Consultancy

Savills Margaret Street

+44 (0) 20 7409 8841

 

Susan Emmett

Susan Emmett

Director
Residential Research

Savills Margaret Street

+44 (0) 203 107 5460

 

Lucy Greenwood

Lucy Greenwood

Associate
Residential Research and Consultancy

Savills Margaret Street

+44 (0) 20 7016 3882