East of England land market remains stable despite lockdown
Development land prices in the East of England have remained stable despite the coronavirus lockdown, according to new research.
Property expert Savills said that the value of the region’s greenfield sites stayed level in the first three months of the year, making an annual rise of 4.6 per cent.
Brownfield land prices fell slightly, by 0.5 per cent, but were still up 2.7 per cent over the year as a whole.
However they stressed that the current pandemic would inevitably lead to a slowdown in market activity – although many existing deals were still progressing.
Overall Savills development teams in the East of England – which includes offices in Chelmsford, Norwich and Cambridge – acted on £113.2 million worth of land deals during the first three months of 2020. The total represents the sale of just over 950 housing plots on nine sites across the region.
Among the most significant deals was the sale of 91 acres of land at Panshanger Aerodrome, in Welwyn Garden City in Hertfordshire, by the Cambridge office on behalf of Mariposa Investments to Homes England – bringing forward one of the region’s largest housing developments with the capacity for 815 homes.
The team at Savills Norwich meanwhile sold a 3.93 acre site in the city’s Barrack Lane with planning permission for 200 homes.
Richard Janes, development director at Savills in Cambridge, said: “The strength of the land market at the start of 2020 largely came as a result of the decisive general election result – with sites that have capacity for 80 to 150 homes the most popular.
“This generated further certainty and confidence in the region, which given its relative proximity to London and strong transport links is already a popular and stable choice for housebuilders at both a national and regional level.
“The disruption brought about by Covid-19 has slowed - but not entirely stopped – transactions. Existing land deals are largely proceeding, just with some delays in completion date. The residential development land market in particular has not seen the same immediate impact as it is based on longer time horizons.”
Commenting on what the months ahead might hold, George Craig, from the development team at Savills Norwich, added: “In the short term we expect to see fewer sites being brought to market as landowners prefer to wait for more clarity.
“However, there are early signs that the Government will look to prioritise re-activating the sector and once the restrictions have lifted – and depending on the length of the current lockdown – we would expect a busy second half of the year.”