The North could become the hotspot of property development
The North of England could become the hotspot of property development, specialist lender Together has found.
Almost two-thirds (65%) of developers plan to increase their investment activity in the North substantially over the next two years, with the biggest opportunities seen as being in houses and flats.
Andrew Charnley, head of corporate relationships at Together, said: “Given the uncertainty around Brexit and the prospect of tougher economic headwinds, it’s encouraging to see developers remaining so bullish, particularly when it comes to the North.
“Our own experience reflects these findings having supported a significant number of new developments in the North with a healthy future pipeline too.
“The chronic supply/demand imbalance in residential housing is creating the biggest opportunities yet many developers continue to be hampered by obstacles such as a shortage of suitable sites and access to finance.
“We understand the pressures facing developers and take a highly flexible approach to meeting their finance requirements, often delivering solutions under highly challenging timescales.”
Property developers are almost unanimously supportive of the government’s Northern Powerhouse initiative with 96% describing it as having had a positive effect.
Houses and flats, for 91% and 80% of developers respectively, offer the biggest development opportunities in the North of England.
This was followed by semi-commercial properties (42%).
Over half (57%) earmarked the North East as Great Britain’s most opportunity-rich region, followed by the North West (42%).
Wales (40%) and Scotland (38%) were also seen as strong contenders for investment.
The research revealed that developers cited a shortage of available sites (51%), insufficient access to finance (47%) and a lack of government support (40%) as the biggest reasons which could impede their ability to invest in new assets.
A third of developers worry about Brexit uncertainty according to the survey.