Housebuilders say planning is their biggest challenge
Planning delays have proved the biggest challenge for housebuilders large and small over the start of 2021.
Despite an uncertain economic environment and rising unemployment, respondents to a Knight Frank survey most commonly cited delays in the planning system as the biggest issue they faced in the first quarter of the year.
A third of the 47 volume housebuilders and SME developers questioned said planning delays were their main challenge. The next most frequent answers were availability of land (cited by 21%) and legal delays in transactions (16%).
Planning delays have proved the biggest challenge for housebuilders large and small over the start of 2021.
Despite an uncertain economic environment and rising unemployment, respondents to a Knight Frank survey most commonly cited delays in the planning system as the biggest issue they faced in the first quarter of the year.
A third of the 47 volume housebuilders and SME developers questioned said planning delays were their main challenge. The next most frequent answers were availability of land (cited by 21%) and legal delays in transactions (16%).
Volume housebuilders have been most affected by land availability, with 24% highlighting this as their most pressing problem.
Land challenges
Going into the next quarter, availability of land is expected to have the most notable impact for companies (cited by 21% of respondents), followed by planning reform and uncertainty around policy (18%).
When specifically asked about land, 51% of respondents said availability of land was limited, 47% said it was adequate, and just 2% said it was abundant. Some 55% of respondents said they expect land prices to increase in the second quarter.
Following a drop in land values during 2020, pricing has begun to pick up. Knight Frank reported a 0.9% increase in greenfield land values and a 0.2% rise for urban brownfield land. However, year-on-year values declined 4.8% for greenfield land and 2.2% for urban brownfield land.
Justin Gaze, head of residential development at Knight Frank, said: “We are seeing a sense of normality return to the market for the first time since the pandemic struck.
“New sites are quickly going under offer at the top end of our price expectations, and there is a severe lack of land availability for both medium and larger schemes – so much so that we’re seeing housebuilders being increasingly competitive in order to compete on sought-after sites of 50 units and above.”
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