Savills Cambridge completes more than £100m of land sales in first half of 2023

The development team at Savills Cambridge completed more than £100m worth of land sales in the first half of this year.

Head of department Richard Janes said the activity was evidence that deals continue to be done despite a changing market.

Significant transactions include 17.79 acres of land at Netherhall Gardens, Worts’ Causeway, in Cambridge, with permission for 200 homes, sold to housebuilder CALA.

Meanwhile 18.63 acres of land at Priors Hall Park in Corby, Northamptonshire, with permission for 264 homes was sold to housebuilder Vistry.

In a separate sale, Barratt David Wilson also purchased 16.03 acres of land at the same site with permission for 248 homes.

Elsewhere in the region 18.85 acres of land in Westoning in Bedfordshire with permission for 133 new homes was sold to Countryside, while a 5.88-acre site in Kettering, Northamptonshire, with permission for 51 homes was purchased by Grace Homes.

In total Savills Cambridge completed £109.3m worth of land sales in the first half of 2023 – making up 166.9 acres with planning permission for 896 homes.

Richard Janes said: “We had a busy first half of the year which is credit to the level of expertise and hard work within the team. Deals are still being done and we have been able to get several transactions across the line.

“Land buyers continue to be selective and supply remains constrained, which to some extent has mitigated the effects of high inflation, rising mortgage rates and more modest new build sales rates which aren’t yet being significantly reflected in the prices paid for land.

“Appetite remains steady and values are holding up for sites in primary locations with no significant upfront infrastructure costs. Whereas sites in secondary and tertiary locations are more likely to see reductions in land values.

“Although some of the major housebuilders are cautiously returning to the land market, many are working through their existing land pipeline which is resulting in opportunities for other players to take advantage of less competition.”

According to Savills research greenfield land values in the East of England fell by 1.5 per cent in the three months to June this year, a drop of 6.4 per cent in the last year.

For the UK as a whole greenfield land values fell by 1.1 per cent in the last quarter and by 4.4 per cent year on year.

Urban land values in the East of England stayed relatively stable, dropping just 0.3 per cent in the three months to June and increasing in value by 1.0 per cent in the last year.

For the UK as a whole, urban land values dropped by an average of 1.3 per cent in the last quarter and by 3.6 per cent year on year.

Tom Fraser, director in the development team and head of office at Savills Cambridge, said: “In the short term, if the supply of land remains constrained then the market is likely to continue operating in its current form, broadly maintaining values for straightforward deliverable sites, as they are relatively few and far between.

“Where there is greater land supply there are likely to be more significant falls in land values; and there may also be pressure on values for more challenging sites where landowners are forced to sell.

“Whilst the mix of economic uncertainty, housing market pressures and the additional costs required to deliver sites will continue to put pressure on land values, the levels of competition are likely to be steady as the major housebuilders cautiously return to selectively replenish their landbanks alongside sustained demand from alternative parties.”

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