Savills Reports ‘Cautious Optimism’ in Development Land Market

Posted by UK Property Forums on 2nd May 2025 -

Revisions to planning policy and the Government’s commitment to build more homes have sparked renewed activity in the East of England’s development land market, according to research by Savills.

However, the property advisor’s report has warned that recent economic uncertainty has delayed decisions by some housebuilders.

The latest quarterly survey from Savills described the overall outlook for the development land market as ‘cautiously positive’.

It warns US trade tariffs alongside continued cost pressures and viability challenges could offset any potential growth in land values – particularly for brownfield sites.

According to the Savills report, the value of greenfield sites in the East of England increased by an average of 0.1 per cent in the first quarter of this year, with an annual rise of 0.8 per cent to the end of March.

Nationally, the value of greenfield sties fell by an average of 0.1 per cent in the first three months of this year – although annually there remains a 1.3 per cent increase.

Values for urban sites saw similar growth of 0.1 per cent in the East of England for the first quarter of this year, although year-on-year values dropped by 0.3 per cent. Nationally, the value of urban sites also fell by 0.1 per cent in the first three months of this year and by 1.9 per cent year-on-year.

Deals already agreed this year by the Savills Cambridge office include the sale of a 4.5-acre site in Potters Bar in Hertfordshire to Chase New Homes earmarked for 265 properties and approximately 26,910 sq ft of office and retail space. There has also been strong interest for sites in Bury St Edmunds and Thetford.

Elsewhere, the Norwich office has sold an 18.8-acre site in Loddon in Norfolk with planning permission for 180 homes to Hopkins Homes. The Chelmsford office has agreed the sale of the former Cavalry Barracks in Butt Road, Colchester, which has permission for 70 properties, to Newell Homes, while a 5.3-acre site in Halstead near Colchester, which is allocated for 30 homes has been acquired by Bellway.

Tom Fraser, head of office at Savills in Cambridge and a director in the firm’s development team (pictured), said revisions to the National Planning Policy Framework (NPPF) had generated enthusiasm among landowners to bring sites forward – although activity has been tempered slightly due to growing uncertainty in the wake of President Trump’s economic tariffs.

He went on: “Overall the market has remained steady, with very little change in development land values. Encouragingly, the East of England appears to be slightly ahead of some other areas and we have seen a reasonable amount of activity since the start of the year – with more land coming to market and more housebuilders willing to commit to a purchase.

“The US trade tariffs have impacted confidence slightly – with some buyers tempted to delay deals until the effect on the UK economy becomes clearer – but the best sites in the best locations continue to command plenty of interest and in general the picture is cautiously positive.

“In particular, there is heightened appetite for strategic land, with many parties viewing this parliament as a window of opportunity to secure a position on Grey Belt sites. We are also moving towards a better supplied land market – though any significant change in the volume of planning consents will take time to feed through.”

Greenfield and urban land values by region: