The value of residential development land has stabilised across most UK regions after five negative quarters according to Knight Frank’s Residential Land Index.
It shows that the average value of both urban and greenfield land rose by 2.1 per cent during the second quarter of 2009, having almost halved since 2007, reflecting greater activity and confidence among developers.
Housebuilders and residential developers now account for 16 per cent of purchasers, up from 8 per cent during the first quarter and are no longer the biggest group of vendors.
They have been overtaken by the public sector as the most important source of new sites. It said that the supply of sites remains highly constrained, with owners dissuaded by sharply lower values.
In the three months to June, average land values in every region outside London showed modest increases. According to Knight Frank after five quarters in which land values almost halved, it appears that the market is now beginning to recover, not just because of the stable pricing in many regions but also because housebuilders and developers are increasingly becoming acquisitive.