Property development picking up in North of England, research shows

If you are a landlord looking for new investment opportunities, you may wish to look to the North. New research shows that the North of England has become a hotspot for property development.

According to a national study of developers, 65% plan to substantially increase their investment activity in the North over the next two years. The biggest opportunities are seen to be houses and flats, according to this study by finance specialist Together.

The study shows:

• 57% have earmarked the North East as Great Britain’s most opportunity-rich region.

• This is followed by the North West, at 42%, Wales with 40% and Scotland with 38%.

• Trailing behind were Yorkshire and Humberside (22%) and the South East (13%).

The Government’s Northern Powerhouse initiative has been unanimously supported by property developers, with 96% agreeing it is having a positive effect. 64% of them said it has been ‘very positive’.

Andrew Charnley, head of corporate relationships at Together, has commented: “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.”

Also revealed by the study:

• 91% of respondents believe houses offer the biggest development opportunities in the North of England.

• This is followed by 80% opting for flats.

• 28% went for bed and breakfasts and restaurants.

Despite property developers’ optimism, the survey identified several headwinds that are likely to impede their ability to invest in new assets:

• 51% of developers cited a shortage of available sites closely followed by insufficient access to finance (47%).

• 40% cited a lack of government support and 33% responded that they were worried about Brexit uncertainty.

The table below shows the areas of the country where property developers see the biggest opportunities over the next two years – and the areas where they see the least opportunities.