VOA - Publications - Property Market Report July 2005

Land values over this period have remained relatively stable across the United Kingdom and the significant increases experienced over the last two three years have not been repeated over this six month period.

It is only when we compare land values of 2001 with those of 2005 that the full impact of the growth in houses prices may be appreciated and these increases have changed the land value relationships across the United Kingdom.

Back in 2001 the Government Office Region with the lowest land value, as recorded by the Property Market Report, was the North East and the region with the highest value was London where values were some seven times greater than the North East. In 2005 not only has North East moved up the rankings with East Midlands now showing the lowest values but the London values are now only some three times higher than the lowest valued region East Midlands.

The house price boom over the period since 2001 has narrowed the range of land values across England, Scotland and Wales. Over the period the North East has seen the most significant growth at over 300%, and the South East the least at 140%.

Land transactions are limited and the opinions expressed in the Property Market Report are based on analysis of these sales and all other market intelligence used when preparing a valuation. A limited number transactions does not necessarily mean reduced demand and is probably more a reflection of the imbalance of supply and demand across the country. Planning authorities in the north are maintaining tight planning controls reducing the supply of sites, especially green field sites. In the south the more sluggish housing market has reduced the demand for sites but land is still in sufficiently short supply to the extent that those sites that do become available are maintaining similar levels of value as seen six months ago.

The majority of transactions that do take place are for smaller infill plots, either for one or two dwellings for self-build or local builders, or alternatively for small high-density developments that have no requirement for affordable housing or other planning contribution.

Planning authority requirements for higher densities, together with site specific, but generally increasing amounts of affordable housing or other planning gain, and specific remediation needs of particular brownfied sites make comparison in terms of a price per hectare ever more difficult. Land prices are increasingly site specific and are a reflection of the particular scheme and obligations that are difficult to translate to other sites in anything other than broad terms.

Work has commenced on some of the Housing Market Renewal ‘Pathfinder’ projects, which have been created by the Office of the Deputy Prime Minister to revitalise areas of the Midlands and the North. Regeneration companies have been established with £1.2bn of public money to spend between 2004 and 2008 in rundown areas of Oldham, Stoke-on-Trent, Hull, Merseyside and Newcastle. The full impact of this redevelopment of brownfield sites, together with the restrictions of Regional Planning Guidance (RPG13) on development of greeenfield land across the same areas is yet to be seen.

Back to the top

England

North East

This region has seen the most growth in land values across the United Kingdom and no longer ‘lags’ behinds its more southerly neighbours. The current reporting period shows this new position has stabilised and, although there are local variations, there continues to be a reasonable number of completed transactions suggesting values are unchanged on those prevailing twelve months ago. Incentives continue to play an important part in the sale of new houses to increase cash flow.

The sale of sites for the developments of flats, particularly on Tyneside, has slowed as supply now exceeds demand. The future prospects for this sector are not as attractive as for other general developments.

Back to the top

North West

The market in North Cumbria is relatively quiet with the local residential housing market having ‘paused for breath’. One new scheme that will be taking shape over next few years will be on the former Workington Infirmary site, the sale of which will be completed shortly for residential development. Otherwise, few sites are available for development and it is expected land values will now stabilise at current levels of value.

There is little new residential development being carried out in Eden. The suggestion is local developers believe planning permission is only likely to be granted for various types of affordable housing. Consequently site owners may have to accept land values that reflect this type of development or 'bank' the land on the basis that there may be a change in the planning regime in the future.

In Carlisle the emphasis has switched to ‘brownfield’ developments, with several former industrial premises being redeveloped. These include Shaddongate Mill, which is under going conversion to flats by Story Homes.

Planning restrictions and the need to concentrate development on brownfield sites, has led to little new development taking place in South Cumbria. New developments are required to include a significant “affordable homes” element where the prices are restricted to approx 65% full market value. On one of the last remaining town centre sites in Kendal, the developer purchased a newly built block of nearby flats to transfer the “affordable homes” element off-site.

The demand for affordable housing in the Lake District and Dales National Park’s is so great that the Dales National Park Authority imposes local occupancy restrictions on any new developments and a housing needs survey has to accompany new applications for residential development within the Lake District National Park area. It is still too early to assess the impact on the housing market and the type and number of developments that will be created.

There have been few sales of residential development land in the Lancaster and Blackpool areas over the last six months but given the shortage of available building land and continued demand higher prices might be achieved in the future. Noteworthy are the restrictions proposed by the adjacent Fylde Borough Council for new developments. The proposal is for a fifty percent allocation of affordable housing for future developments, although they may be prepared to allow the affordable homes to be built off site, or a commuted sum paid to the council in lieu thereof.

All the local authorities in central and west Lancashire have introduced tight planning policies for residential development. This reflects the impact of the Regional Planning Guidance (RPG13) issued in 2003, which reduced the annual build rate in the North West from 15,000 to 12,700 units. As a consequence the supply of land coming to the market is very restricted and there is strong demand for that which is available. Planners are inclined to favour schemes including apartments in town centre locations that are considered likely to have a regenerative impact. Most of the sites available in these areas have been fairly small and are often brownfield. These attract good interest from local builders and value levels remain buoyant. In view of the planning moratoria, high land values are likely to be sustained, despite the stagnation in the housing market.

Within east Lancashire, all the local authorities maintain rigid planning controls on any type of residential developments. Only those sites suitable for social or key worker housing, are granted consent, provided that a need for such can be proved.

Available sites with planning consent or that are situated in Housing Market Renewal areas attract a great deal of interest from both local and regional developers. These sites are usually marketed by informal tender and have readily achieved in excess of the initial asking price. A site in Mill Hill, Blackburn comprising a former garage colony is on the market and is expected to achieve a price of approximately £1.8 million per hectare. This area of the town is not the best or one with high residential values but is obviously one where the completed product is likely to find a ready market. A larger two hectare site in Roe Lee/Bastwell, Blackburn, has been sold recently at £1.4 million per hectare. These high values are indicative of a limited supply and a generally increased demand for any site with the required consent.

There have been relatively few transactions in Greater Manchester over the last six months. Generally those sales that have occurred suggest no change in value since 1 January 2005, although there has been a noticeable increase in prices at the lower value end of the housing market. The minimum value for residential building land, ripe for development, within Greater Manchester is considered to be approximately £1.2 million per hectare.

The shortage of available sites, particularly greenfield sites, within the southern areas of Greater Manchester, coupled with continued high demand for housing, has resulted in the displacement of demand into previously less desirable neighbouring areas. House prices in some of the historically lower priced districts, for example Rochdale and Oldham, have experienced a ‘catching-up’ increase.

Significant amounts of investment monies, both private and public, are flowing into Manchester at present. It is anticipated that a large number of jobs will be relocated here from the Southeast, including the BBC and several government departments. These events are likely to sustain the market at its current level in the immediate future.

Due to the planning moratoriums in the Macclesfield, Congleton and Vale Royal Borough Council areas the market has become increasingly difficult to analyse, with the few sales being mainly in respect of brownfield sites, with values reflecting the specific nature of the site. Similarly, in the Crewe and Nantwich Borough Council areas, there have been significant amounts of residential development in the previous two to three years, but this is now coming to an end.

The planning authority’s moratorium on residential building land consent in Chester appears to have resulted in no recent sales within the city boundaries. The housing market is slowing, and flats in particular remain greatly over supplied. In April the Council increased the percentage of affordable housing required on any new site that does receive permission from 25% to 40%. Developers suggest this may impact on the accommodation mix, particularly premium developments, such that property prices will be reduced but there is insufficient sales evidence to date to support or refute this suggestion.

Back to the top

Merseyside

There have been few transactions of land for residential development during the last six months with those that have completed being usually between public bodies. Transactions involving private developers are very limited. The limited evidence suggests the market in Sefton, Liverpool and Knowsley has remained fairly static over the last six months.

The housing market generally, after spectacular price rises during 2004, has slowed considerably and is possibly a factor in the low number of land sales. It remains to be seen whether the large scale commercial developments taking place on Merseyside, in preparation for Capital of Culture in 2008, will promote further interest in residential development sites.

The local authority in Warrington maintains planning constraints to restrict residential development. However, there are a large number of ongoing or planned developments in Warrington North on brownfield sites, mainly for apartments. Sales evidence indicates there have been significant rises in land values throughout the locality, although there continues to be the danger of over supply in this area of the market. There have been few transactions in Warrington South, and those concluded suggest land values have remained static over the last six months. However, with land suitable for residential development being restricted, future sales may attract higher prices.

St Helens exhibits a wide variance of values, dictated by location and land conditions, with recent transactions appearing to indicate an increase in values for large sites. As with many other areas, the local authority is endeavouring to the limit residential development. Within Halton there is limited evidence of sales of development land. The majority of land being made available is held by the local authority and these transactions have shown a significant rise in land values. The planning authority for Wirral have imposed a moratorium on new residential consents in the more desirable areas of west Wirral and this appears to have displaced demand to the more urbanised areas of east Wirral, including Birkenhead and Wallasey, resulting in increased land values, possibly up to £2.4 million per hectare. However there is no significant evidence of sales to support these assertions.

Limited evidence suggests a cautious approach to Ellesmere Port market. Two transactions in late 2004 at Ince Road and Cromwell Road, both with remediation issues and which were located in less desirable locations, would suggest poor buyer confidence. No pick up in confidence has been evidenced more recently.

Back to the top

Yorkshire and Humber

Generally, there is increasing nervousness amongst house builders about future prospects for the housing market.
resulting in a more selective approach to site acquisition, particularly where apartments represent a significant proportion of the scheme. Land values are generally being maintained but the amount of interest in some of the properties has been reduced.

In the Doncaster and Barnsley areas there have been fewer transactions with a suggestion that uncertainty in the housing market may have had some impact, but that lack of available sites is probably the key factor. Those transactions available are very difficult to analyse due to the impact of planning densities, design and affordable housing provision which to a large extent are all site specific. Prices achieved continue at a high level and a fall or stagnation in values is not anticipated in the near future. Good sites in good areas are very much in demand with small sites remaining very popular with the small builder or self-builders developing their own property. Smaller sites are achieving good prices with in excess of £200,000 being paid for one dwelling infill plots in the very best area.

Back to the top

East Midlands

The housing market in Derbyshire continues to slow down and generally demand for residential building land has followed a similar trend. However, sites in good residential areas are still popular and selling well, but the evidence suggests no increase in value over the last six months.

In Nottinghamshire, the local housing market appears to have maintained level values since the summer of 2004. This has flowed through to land prices with insufficient evidence to suggest any change since January 2005 in most parts of the county, although small pockets may differ from the overall trend.

Similarly in Lincolnshire, there have been very few reliable land transactions on which to form a firm opinion of value. The opinion is that in most areas, values are fairly static, with the exception of the Gainsborough area. Here transactions suggest values, which have historically lagged behind the rest of the County, are increasing, although not yet to the level of the County norm.

There is a dearth of sales evidence in Northamptonshire and Leicestershire on which to form accurate opinion, however based on the sales that have taken place the market would appear to be static.

Back to the top

West Midlands

Demand for city and town centre sites for development of flats and apartments, particularly in Worcester, is increasingly strong encouraged by planning policy requiring increased densities. The remainder of the residential market is reasonably buoyant in Worcestershire and Herefordshire, although general values do not appear to have risen over the past six months

Wolverhampton has experienced a relatively quiet market with few residential land sales in the last six months; with almost all of these being of small development “infill” plots for 1 or 2 dwellings. Likewise there is limited market evidence for land sales in Coventry, mirroring the reduced volume of housing market transactions. The opinion is that values remain unchanged from those reported in January 2005.

Demand for residential developments sites is still at a buoyant level across Sandwell, the majority of these sites being of brownfield land. Low interest rates, together with the shortage of supply and strong demand is affecting the value of residential development land. This is also helped by planning policies that favour increased densities. Brownfield developments are increasingly common and demand for these sites suggests an upward trend in value land since January 2005. However the prices achieved are site specific and reflect remediation or abnormal costs required to develop the particular site. The requirements for affordable housing and Section 106 agreements also impact on values.

There is uncertainty over the state of the bulk land market in Stoke. In August 2004 St Modwen submitted plans to develop the former football stadium (6.5 ha) with offices, restaurant and 150 houses. This application has not yet been decided, with some concerns about the scale of this project and a possible conflict with a Pathfinder scheme, which will see 14,500 ageing properties in Stoke and adjacent Newcastle, demolished and replaced with 12,000 new homes. St Modwen also has plans on hold for the redevelopment of the former Royal Doulton headquarters pending the finalisation of a strategic plan for the area and another pottery manufacturer has applied for redevelopment of one of its factories for 138 homes.

There is still a lot of interest in the market for apartments in Newcastle under Lyme. In recent months three further schemes of 100 apartments each were announced, with at least three further sites being talked about as having potential. However, there are mixed views as to whether the market is now saturated and the planning committee recently rejected its officers’ recommendation, and turned down one of these proposed schemes.

The conversion of redundant mill buildings is the main source of supply for the apartment market in Leek. There is still demand for small plots in the Staffordshire area generally.

The residential land market remains strong across Birmingham. The recent closure of Rover’s Longbridge plant to the south-west is creating some uncertainty in the local residential market, but until the plant’s future is resolved, its wider impact remains unclear.

Back to the top

East of England

The market has remained relatively quiet over this six month period with a limited number of transactions and those that have taken place being mainly for small infill sites. More details are provided below for some of the locations within the region.

There have been very few transactions for Basildon, the majority being for small sites and with static house prices in general for this area, there has been no increase in land values generally.

Grays has seen sales of several brownfield sites and one sale of land to a housing association. Although generally a quiet market there is a perception that land developed for flats has increased in value, due to the availability of planning consents with higher densities.

The steady housing market in Saffron Walden, and several sales of smaller plots, suggest an increase in land values. These factors, coupled together with the proposed second runway at Stansted and its proximity to the M11, suggest there will be increased competition for all categories of land in the area. Further south the majority of evidence for Chelmsford and Epping Forest is for small sites and land to be developed for flats. The availability of increased planning densities and the scarcity of land have seen an upward trend in values.

Whilst there is extremely limited sales evidence for Brentwood, it is felt the general increase in land values in surrounding districts would be reflected in Brentwood, where residential values are underpinned by it’s commuter links to London. The lack of land sales in Harlow over the last six months, coupled with a flat housing market suggest values remain unchanged from January 2005

Whilst there are few current land transactions in Tendring, Colchester, Braintree, or Maldon, there are already significant numbers of developments in progress. The suggestion is that house builders are becoming more cautious and although interest remains in any land coming to the market many are making greater use of conditional offers.

There is a lack of sales evidence for bulk land in Southend, Rochford or Castle Point and the majority of transactions are for small sites particularly for redevelopment of one or two properties.

Bulk land sales in Norfolk are very limited, and where sales do occur, there has been no significant movement in values over the past six months. Limited evidence for small infill development indicates values remain strong, although it is felt they have probably now peaked.

In the last six months there have been very few sales of bulk residential land in Huntingdonshire, Fenland and Peterborough. National house builders are continuing to offer incentives to purchasers in order to sell their properties. Individual plots continue to sell as numerous buyers compete for the limited number available. There is demand for small infill developments, however prices achieved show no significant upward movement.

Two large brownfield sites in central Cambridge have sold recently situated near the railway station and Richard Rogers will be the architect for the redundant flourmill site immediately next to the station, which will include a cultural centre. These sales confirm the continuing demand for high density; mixed-use sites, with ready access to commuter facilities to London. Demand for this type or property and location, close to good transport links, has resulted in increased land values.

There is still some demand for larger sites, particularly in Ely and Cambourne but more generally in South Cambridgeshire activity is somewhat subdued, reflecting the overall levelling off in house prices.

There have been few sales of bulk residential land across Suffolk over the last six months. All sites transacted within the Ipswich Borough boundary have been of brownfiield sites, often involving conversion of existing commercial property as well as new build. However the slow down in the rate of sales of finished property may well be affecting activity in the bulk land market. The west of the county appears more active than the east as Cambridge still has an effect on the market. There is still high demand for individual plots but an ever-decreasing supply. Infill sites for 5 or less dwellings are similarly in demand from local builders.

Back to the top

Inner London

Generally, the residential market remains uncertain and difficult to value, and there has been a distinct lack of transactions across London. There is clear demand, however, for small sites where there is no requirement to provide affordable housing. Any large scheme can be expected to attract interest from the major developers but the affordable housing requirement and degree of funding available results in a final transaction price being site specific and difficult to translate to other sites except in the broadest of terms.

There has been no evidence of sales of sites in Maida Vale and Paddington, and a general slow down in the residential market for this location, with little activity, and flat market conditions. All potential sites in this location are brownfield land and developers are increasingly concerned about the costs and risks associated with contamination/cleanup, infrastructure and relocation of existing occupations/uses related with such sites. On the whole the brownfield market is not as attractive as the greenfield market. However there is no evidence to suggest a fall in value, the limited supply for sites probably keeping the values level.

In Kensington and Chelsea there is no sales evidence for bare sites. Whilst the market in second hand property is still falling generally, demand for any bare site coming onto the market in Chelsea is still such that the price per hectare will be maintained due to the scarcity factor for such prime sites. There is a large-scale flat redevelopment nearing completion in W8. Although demand for property is not as strong as one to two years ago, it is not considered there has yet been an impact upon residential land values in the area.

In Hammersmith, again there are no sales of bare sites for development. Although second hand property is experiencing falls in value, such decreases have yet to be reflected in land values, due to scarcity of bare land in the borough.

Commentaries for Hackney, Islington, Newham, and Tower Hamlets last year emphasised the local and central governmental pressures fuelling higher residential densities and thus development land values. Inner City Boroughs seldom reject schemes on density grounds alone, particularly where significant affordable/key-worker housing is achievable and a socially beneficial land use (e.g. primary healthcare) can be incorporated into a scheme. A combination of a thriving housing market and densities well beyond UDP norms has produced a strong residential land market in recent years.

The balance of these factors is now potentially more unsettled and developers faced with uncertain receipts and escalating building costs could potentially increase their inbuilt risk/profit element as a result, reducing the sums available to purchase development land. This possibility is currently being reflected in a reduced number of transactions, rather than an actual decline in residential land values.

It is noticeable that mixed-use schemes appear to be increasingly prevalent, a combination perhaps of both planners’ requirements and developers spreading their risk. Disposal of former Local Authority and Hospital land particularly promotes this type of scheme, often with the inclusion of a socially beneficial land use (e.g. health/education) by virtue of Section 106 or otherwise.

Notwithstanding the geographical factors specifically influencing these locations, the general trends described above are considered to have created a period of stability in the residential land market.

In Lambeth and Southwark the market for residential land has continued to show signs of slowing over the past six months. There have been fewer land transactions in recent months and most of the significant transactions have been to public sector builders.

Affordable housing remains a significant factor and one that private developers were able to accommodate relatively easily when the market was rising. However, the current market is static, with some predictions of a fall, and so developers are unwilling to take the potential financial risk of purchasing sites and then having to provide low-cost units whilst suffering a loss of profit from falling values.

In Wandsworth developers would appear to be taking a cautious approach across the borough. The few sites that have been sold are small infill sites of around 0.1 hectare. The second hand market has now stabilised, with some prices falling, and this is expected to be mirrored in residential land, though any prominent site brought to the market, particularly with river frontage, can still be expected to command a premium.

Back to the top

Outer London

In Barking & Dagenham, Havering, Redbridge and Waltham Forest, the housing market has slowed over the last twelve month period, with housing sale values in the last six month period being static. Demand for “good” building land however remains strong, although values do vary greatly, and are site specific. There have been very few recorded land transactions over the last six month period, the majority being small infill sites and land for flat development. Due to increased urban densities and land scarcity, values have continued to rise, but as mentioned above, values are wide ranging and are very site specific.

In Hounslow and Ealing generally, a sluggish end-product market is leading to some uncertainties in the market for the raw material, namely the land. However, developers need land to maintain their raison d'etre of building houses/ flats. Accordingly, although sites are still being sold and deals done, values remain on a plateau, and there is no sign of a collapse. Within this general pattern there are always some special cases. Feltham, for example, with its town centre re-development may become a focus for residential developers' interest

In Enfield, Barnet and Haringey, once again there have been few transactions of any size, with most being of small infill or brownfield sites. Purchasers are seemingly prepared to buy land even when the planning situation is uncertain or contamination means site rehabilitation costs may be high. There is no evidence yet that the reported slow down in the housing market has fed through to land sales.

In Brent, Harrow & Hillingdon there has been little evidence available in the area and the sales that do take place tend to be for flats/apartments in secure developments.

Sales of second hand houses have slowed, but in general prices have been maintained, and this has kept demand keen for small sites and infill plots. There has been some local demand for house and garden extensions. Agents report that demand for larger sites has been somewhat muted but there is no evidence of reduced prices, though it is expected that values will be fine-tuned to reflect any additional costs that may arise.

In Kingston, Merton and Richmond there is no direct sales evidence, and the developments in course of construction would seem to be a result of earlier land purchases. These are all small schemes without the impact of affordable housing. There is now evidence that the second hand housing market has reached a plateau, and modest falls are being recorded. With the uncertain housing market and increased construction costs, it is expected that land prices will remain static, or possibly fall if there is pressure to provide additional affordable housing.

In Bromley, Croydon and Sutton the pressure continues for purchase of existing single houses on large plots for demolition and replacement with several houses, particularly in Bromley. Such development is likely to be below the level at which affordable housing is required. There is also intense pressure for back land development, with planning consent being granted for access via very narrow gaps between established frontages, including rear of tertiary shopping streets.

Of the larger sites 'Aquilla' Bickley Kent (former MOD research huts long since closed and removed), is underway with about 280 new houses of various types with one flank of this huge site set aside to satisfy affordable housing.

In Bexley, Greenwich and Lewisham, there has been little tangible evidence, and most developments in hand would seem to be from historic land acquisitions. Nevertheless strong interest can still be expected in sites overlooking the Thames in all three boroughs.

Whilst it is believed that residential land is still selling, as yet, confirmed sales have not been reported. The current slow down in residential sales of completed developments can be expected to keep values static at best, and changing political and macro economic variables are likely to dampen values further.

Back to the top

South East

Within the Medway Towns there have been a significant number of transactions relating to small schemes and in fill developments. Longer term there are plans for further development at St Mary’s Island, Rochester, Strood riverside and countryside to the east of Gillingham.

Larger schemes in Gravesend are now coming on to the market including a social housing development on a school site to the south of the town and a brownfield site adjoining the hospital in the town centre.

Dartford has seen a lot of transactional activity with prices showing a marked increase. The former West Hill Hospital on the edge of the town centre has recently been sold for residential development. Away from the town centre the former Maypole School in Bexley has been sold for redevelopment with apartments. Longer-term, substantial residential development is planned in connection with the regeneration of Dartford town centre including a large element of social housing. The next phase of the Waterstone Park scheme near Bluewater is now being developed.

Brownfield sites adjoining the River Medway close to Maidstone town centre continue to be redeveloped with several further large schemes being explored. A school site off the A26 Tonbridge Road is currently being redeveloped and a surplus NHS building within the town centre has just been sold. There has been a notable increase in the number of development schemes being undertaken in the villages surrounding Maidstone, particularly Harrietsham and Headcorn.

Due to planning restrictions and limited supply, there are few transactions in Sevenoaks, with those completing largely confined to single plots. Development is still occurring along the A264 Pembury Road in Tunbridge Wells. There are plans for the redevelopment of a Council owned development on the edge of the town centre. In the Tonbridge and Malling areas further development is planned at Kings Hill and new development is under way at Snodland. Close to Tonbridge town centre, along the A26, there is a new McCarthy and Stone development being built, as well as a number of small infill schemes. At the Ropetackle site, Shoreham, most units have been sold off plan with very few other opportunities for further development.

Within the Arun area, the final phase of the East Bank development is on the market and Bognor has new flats at Marine Park Gardens on the seafront. Hargreaves are experiencing very slow sales to their development at the western end of the Rustington By-Pass. Developments referred to in the January 2005 report are still being marketed in Chichester, reflecting slower residential market even in new schemes. A new residential development planned next to the new Leisure Centre in Crawley has not yet commenced, but building is underway at the former special school at Ifield, with several flats already reserved. Continued uncertainty as to expansion plans for Gatwick are frustrating further development to the north of the town.

Horsham has very few opportunities for large-scale development at this time. With the exception of Bolnore village, where work is still in progress, there are few opportunities for development in Mid Sussex. The Warnes Hotel site, Worthing, is selling well but this reflects a luxury apartment seafront development with an integral leisure complex.

Despite the drop in overall demand for both residential houses and flats in the Reading area in the early part of 2005, demand for residential sites appears still to be strong and overall land values appear to have been maintained. Similar trends are distinguishable across the rest of Berkshire also.

Oxford continues to experience a severe shortage of building land, being constrained by Green Belt policies. Locally, discussion continues between the City Council and County Council about encroachment into the Green Belt. All local districts have expressed concern about additional housing in their areas, particularly where the County Council have earmarked development. A focus of concern is the inadequate infrastructure and transport links. There are few bulk sites available, with the largest site apparently 0.55 of a hectare in the village of Kennington, just outside Oxford. It believed to be under offer at a little under £3.25 million. ODPM have not, as yet, indicated the extent of MOD land in Oxfordshire, if any, where development would be allowed.

Despite a buyer’s market in completed dwellings, the shortage of land in Hampshire has maintained land values and in some areas modest increases have occurred, notably in Winchester and The New Forest. The imminent release of former NHS property by ODPM , including at Basingstoke, may well redress the supply and demand imbalance. Flat developments appear to have exhausted supply in Basingstoke but less so in the University City of Southampton.

The limited number of sales over the past six months in Buckinghamshire, are insufficient to give an indication of the current trend in prices. However, the suggestion is residential land values in Aylesbury Vale and Milton Keynes are likely to soften, due to a successful campaign by the South East of England Regional Assembly for more affordable housing in these areas. This feeling is strengthened by the continued stagnation in house prices. In the south of the county stringently enforced Green Belt policies continue to restrict development, with the result that only small sites come to the market. With no affordable housing requirements and strong demand, it is believed that current levels of value are likely to be maintained.

Back to the top

South West

Housing activity in Somerset has slowed markedly over the last six-month period. Agents are reporting many more houses for sale than this time last year and an increased supply, coupled with reduced demand should lead to lower house prices. Although there is currently limited evidence, it would appear residential land prices remain unaffected. This is primarily owing to the lack of supply, with delays in the local plan process, suggested as the cause.

Similarly in Devon, the sale of houses has slowed dramatically in the last six months, with the apparent exception of more valuable country houses were the influx of ‘City’ money has resulted in a number of completed sales.

To date there would appear to be no impact on the value of residential land, where continuing strong demand from builders of all sizes seems to have kept prices at record high levels. It will be interesting to see whether these values can be maintained over the next few months.

There are few bulk land sales to analyse, but numerous single plots are still selling for good prices all around Dorset. Auction sales of plots, and barns and buildings for conversion have been good recently. The residential market has been somewhat cautious over the last six to nine months, although this does not seem to have reduced demand for smaller sites. Whilst it is not yet clear, indications are that the residential property market is on a slow slide downwards, and if this happens bulk land values would be expected to follow the same path.

Gloucester city at present has a considerable range of inner and fringe of city centre sites that are being developed as flats, including a major extension of works within Gloucester Docks, comprising both infill and conversion of old warehouses. Cheltenham similarly has extensive high-density urban sites under construction.

Back to the top

Wales

After some striking increases throughout 2003 and 2004 the value of residential land stabilised in South and West Wales during the first six months of 2005, although North Wales continued to see some growth, albeit at a slower rate than previously.

In South Wales demand for sites remains strong throughout the region. The influence of the Cardiff market continues to be felt over a wide area as relatively high levels of house prices in the city force buyers to look further afield along the M4 corridor and into the Valley communities. Within Cardiff two national builders have acquired the eight hectare former Atomic Weapons Establishment site at Llanishen, (having already had some remediation work) but difficulty in selling apartments in Cardiff Bay is leading developers to be increasingly cautious about such sites, especially if there is no water frontage.

National builders now actively seek sites in areas where such development was uncommon only a matter of three years ago. For example, Redrow Homes have purchased a 25-hectare site in Ystrad Mynach, five miles north of Cardiff.

Either side of Cardiff along the M4 corridor, demand for sites in Newport and Bridgend remains strong, with the Parc Derwen scheme to the north of the Bridgend imminent. In Swansea a number of sites close to the city centre have been acquired by national builders, with the Swansea SA1 mixed commercial/residential docklands redevelopment continuing apace.

In the more rural areas of west and mid-Wales demand remains strong from both local and national builders.

Back to the top

Scotland

Regional Reports

In Fife, Thomas Mitchell Homes have recently acquired a 4.6 hectare site for £3 million and planning consent for 80 houses has been secured following an appeal to the Scottish Executive.

In Stirling, developers Quality Street & Bett Homes have formed a joint venture company, Stirling Waterfront Ltd, to build around 200 homes in a £35 million project at the riverside end of the 16 hectare Forthside development. Councillors have given final legal approval for the creation of a new city quarter consisting of five phases of development, which will ultimately house the council’s new headquarters, 200 homes, a hotel and conference centre and leisure facilities. The residential element will be built on a phased development on 2 hectares of land and will include a riverbank walkway and landscaping.

A joint venture company Shawfair Developments Ltd has been formed between Miller Homes and Edinburgh and Lothian Councils to deliver a new town in the south east of Edinburgh. Over a 15 year period, 4,800 houses and flats will be developed, together with 2.2 million square feet of business space, a shopping centre, leisure/sports facilities, and essential infrastructure including schools, road networks, sustainable urban drainage, utilities, and a new rail line and town centre station. The development footprint will be over 182 hectares.

Also in Edinburgh, a plan to guide development in Leith Docks over the next 15 years has been approved by the City Council. Under the guide, Forth Ports Plc will create 18,000 new homes for the 170-hectare site and the development is the largest single planned development area ever for Edinburgh. The intention is to extend Leith by integrating old and new in a mixed, balanced and inclusive waterfront community and will allow the population of Edinburgh to grow by up to10%. The mix of uses within the area will be influential in how the area develops as a sustainable community and will include nine new waterfront villages, numerous green spaces, cultural and heritage ‘hubs’, as well as new health and education facilities. A variety of housing types is planned for the area including waterfront apartments, key -worker accommodation, family homes and waterfront villas.

Plans are being prepared to develop a further 6.5 hectares of the Scottish & Newcastle brewery site at Fountainbridge in Edinburgh. Agents are working on plans for the brewery that include up to 140,000 sq m for regeneration at the Fountain South Site, of which over 50% will be housing creating over 500 new homes. The balance will be offices, shops and leisure. The development will form the next phase of a large scale development along the Union Canal, the first phase of which is the 3 hectare former McEwans’ brewery site, which was purchased by the Fountain North consortium - comprising Grosvenor, AMA (Newtown) and the Royal Bank of Scotland. The consortium have already submitted an application for a £20 million, 84,000 sq m development on the Fountain North Site, including 650 new homes and 15,000 sq m of office space. The consortium is likely to be one of the favoured contenders to be selected as a development partner for Fountain South.

In Glasgow Ogilvie Homes have started work on their site at South Portland Street, which is the first project in the proposed Laurieston area renewal master plan. Consisting of 41 flats, the project will complete the urban block fronted by Laurieston House and is to include underground parking.

Kier Homes Ltd have recently acquired the former Shields car showroom complex at St Andrews Road, Pollokshields for £6.6 million plus VAT. Planning permission is currently being sought for the construction of 120 one and two bedroom flats on the 1.27-hectare site.

Planning approval has recently been given for the construction of 770 apartments in a £70 million project for Kippax Ltd and Dandara Ltd as part of Phase 2 of Glasgow Harbour. The controversial development features residential towers from 14-22 storeys and is located on the northern edge of the Clyde in the area that once contained the Meadowside Granaries.

Bellway Homes are currently on site at their ‘Bowfield’ development within Penilee in the south west of Glasgow. The project is a regeneration scheme that will ultimately provide 222 new homes ranging from 2 bedroom terraced to 4 bedroom detached properties and prices currently start from approximately £95,000.

In Shawlands FM Homes are currently on site at their “The Point” project which consists of 64 flats in a mix of one and two bedroom apartments, as well as a smaller number of three bedroom duplexes, set in two buildings. The 0.828-hectare former garage site was acquired for almost £3.8 million earlier this year

Also in Glasgow there has been significant interest in the former Notre Dame convent ( laterally the Learning and Teaching Scotland building), known as Dowanside house, situated within Victoria Crescent Road, Dowanhill. Around 12,000 sq m of Victorian building stock suitable for residential development will be available, a scale not previously seen in Glasgow’s preferred West End.

In Inverclyde, plans for a multi million pound riverside project have moved a step ahead following backing from the Council’s environment and regeneration committee. Redevelopment of the East India and Victoria Harbours in Greenock is part of ‘Riverside Inverclyde’, a joint scheme by the Council and Clydeport. Plans for the 7.5 hectare site include 250 flats and townhouses, a marina and leisure facilities.

In Ayr, Lynch homes have released their ‘Ewanfield’ development, which consists of 21 detached family homes in 4-6 bedroom layouts and comprising 8 different styles on a site situated within easy access to the A/M77. Prices start from circa £379,000.

In Paisley, properties are selling well within the Carvill Groups' ”The Weave” development set beside Paisley’s Old Mill within the heart of the town centre. The development consists of 121 flats and houses and two apartment flats start from £99,995, two bedroom terraced homes from £115,000 and three bedroom terraced homes from £132,000.

George Wimpey West is currently on site at their Regency Gardens development, Hyndford Road, Lanark, which is within walking distance of the town centre. When complete there will be 69 four and five bedroom detached homes and prices currently start from circa £225,000.

By way of contrast, Machrinanish on Kintyre’s west coast, offers something different. Since 2001 more than 100 buyers have taken up permanent or holiday residence at the ‘Sound of Kintyre’ development promoted by Anglo-House Scotland Ltd who have now put the final phase of 22 detached and semi-detached three, four and five bedroom upgraded and new build properties on the market. Most houses have conservatories and several enjoy views over Machrahanish Bay, the islands of Isla, Jura and towards Northern Ireland. Prices currently start from circa £185,000.

The residential market is still buoyant in Dundee and nearby towns and villages. Additional land has been released for development following the outcome of the Public Local Inquiry into the Dundee Local Plan Review and there is good demand from all sectors of the market. Values continue to rise for all types of site.

Changes in planning policies and the outcome of the location of the Aberdeen Western Peripheral Route hold the key to future green field developments. In the meantime the market remains strong, but less active than in recent years, for brownfield sites in Aberdeen City. Regeneration projects with emphasis on affordable housing are becoming more common in this area.

The residential market in Dumfries and Galloway is still very strong and demand for individual house plots outstrips supply. There continues to be strong demand for larger sites also and recent sales indicate that values of residential development land are rising.

Back to the top