London has long been presented as an overcrowded city with people living in shoebox flats and businesses clamouring for any office space that remains. However, the house building land sector continues to thrive – 2012 saw an increase in activity as a matter of fact – despite fragile economic conditions, with London in particular set to benefit.
According to research from the CBRE, the land market has benefitted from many house builders looking to kick on after achieving financial stability with many competing for sites that are primed for residential development and seen as a secure option for investment.
Not that this is the case everywhere in the UK – house builders are concentrating their efforts in areas, such as London, where there is still high demand and land acquisition makes good business sense.
At Hastings we believe it’s reassuring that house builders are still finding capitalise on opportunities to build new homes in London. Some areas are in desperate need for more residences and there have been some very innovative approaches to turning vacant sites into living accommodation. Demand for London property will always exist, so anyone who can purchase land and develop housing is certain to have no problems selling units.
It is predicted that a wide range of house builders will be looking to make inroads in central London, particularly for schemes with a high number of units that are close to good transport links. Land with planning permission will be particularly highly sought after while slightly further afield commuter towns will also be in the developers’ sights.
Jennet Siebrits, head of residential research at CBRE, said: “Government backed lending initiatives have helped restore confidence with house builders, for the moment. FirstBuy created 10,000 sales in 2012 and NewBuy produced 1,500 reservations.
“Slow, yet encouraging growth in the mortgage lending market has supported a pick up in the land market. However, developers will be keeping a keen eye on lending conditions, as FirstBuy and NewBuy are due to close in 2014.”