Strong demand from national house-builders ramping up their output has given a significant boost to residential development land values across the UK, according to a new report by Savills.
Land supply remains one of the greatest barriers to housing delivery as available land is being quickly absorbed in most locations. Greenfield land values grew an average 7.5% across the UK in the year to the end of March 2014, with urban values up 6.4% over the same period.
Savills reports: ‘The resurgent housing market pushed greenfield land values up by 11.2% in the South East, followed by the West of England at 6.8%. In key commuter and prime regional urban locations – Crawley, Leamington Spa, Oxford, Sevenoaks and St Albans – greenfield values are now above their former 2007 highs.
‘There are now early signs of improved land market conditions outside the highest value towns. Bolstered by Help to Buy and improving new homes sales rates, Manchester, Leeds and Birmingham are now seeing land price growth as house-builders and developers look to secure their land pipeline.’
The North of England recorded the strongest growth in the first quarter, albeit from a low base. Greenfield values rose 8.1%, but remain 53% below their peak, while urban land values rose 5.0%, but remain 69% off peak.
