2023-10-29-莱坊-UK_Res_Dev_Land_Index_Q3_2023_3页_182kb

UK residential development land market saw a modest decline in Q3 2023, with greenfield and urban brownfield prices falling by 2.4% and 2% respectively, driven by stable interest rates (5.25%) and a surprise inflation drop (6.7%). This contrasts with a late Q2 2023 peak and Q3 2022 levels. Land values are stabilizing, particularly in areas outside London, with sentiment boosted by central banks holding rates steady.
Greenfield declines (17% since March 2022) outpaced brownfield drops (20%), with demand shifting towards single-family housing (40% of investment in BTR market H1 2023). Volume housebuilders are cutting build rates due to affordability constraints, while planning delays remain a key challenge (85% cite as biggest issue Q3).
Looking ahead, developers face conflicting views: 48% expect land prices to fall, while greenfield demand is strongest in the South East. Labour and material costs will likely rise, worsening profitability. Builders are adapting through higher sales rates and incentives (e.g., cash-backs or deposits), while single-family housing is attracting more investment due to strong demand.