South East resi land value growth dips
Residential land value growth in the South East fell for the first time in two years at the end of 2018. South East greenfield land values dropped by 0.6% in the last quarter of the year.
Savills pointed to buyer caution, slowing new home sales and rising build costs putting pressure on growth in its quarterly UK residential development value index.
Across the UK, greenfield land values rose 1.9%, with urban land values up 6.2%. Savills reported growth in Scotland and the Midlands up by 1.5% in Q4 and 7.5% year-on-year, underpinned by house price growth in the regions.
Residential land value growth in the South East fell for the first time in two years at the end of 2018. South East greenfield land values dropped by 0.6% in the last quarter of the year.
Savills pointed to buyer caution, slowing new home sales and rising build costs putting pressure on growth in its quarterly UK residential development value index.
Across the UK, greenfield land values rose 1.9%, with urban land values up 6.2%. Savills reported growth in Scotland and the Midlands up by 1.5% in Q4 and 7.5% year-on-year, underpinned by house price growth in the regions.
The report pointed to new planning policy helping to unlock land for residential development, with supply now exceeding home delivery goals. It comes as HMRC data also reveals stable home transactions for the fifth consecutive year.
Lucy Greenwood, Savills residential analyst, said: “While rates of new-build home sales have remained relatively stable, there are clear signs of increased home buyer caution and greater reliance on incentives to get sales over the line. Clarity on Brexit would make a big difference to this picture.
“Over the mid-term, cyclical changes in the housing market and housing policy will continue to dictate both turnover of development land and the price at which land trades in different locations. This said, land values are currently pitched at a lower level relative to house prices than in previous cycles, which will minimise the downside risk.”
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