Despite fears that the housing market is overheating, new homes prices are continuing to soar with many developers selling properties up to nine months ahead of their build programme.
However, this buoyant market disguises the fact that housebuilders are struggling to produce their homes, according to leading land and new homes specialists RPC Land and New Homes.
“Developers are having huge problems caused by the totally inadequate planning system and a desperate shortage of skilled labour” says RPC Managing Director Peter Randall.
In many cases planning applications on land are now taking some 12 to 18 months to negotiate, despite the Government’s rhetoric to encourage planning authorities to process applications more quickly. Meanwhile, we all continue to be frustrated by the inevitable delays in planning, creating a shortage of planning consents which in turn leads to a shortage of new homes and with the current demand, prices will inevitably continue to rise.
“In addition, labour shortages are further frustrating the market, pushing developers’ costs up and delaying new homes coming to the market. And he warned “The situation is likely to get much worse before it gets better”
The recently published Green Paper aimed at modernising the antiquated planning system will not bring any real benefits for some years.
RPC – one of the largest firms in Kent and Sussex with centres in Tonbridge, Dartford, Maidstone and Haywards Heath – report that residential land prices are continuing to rise.
The Government has brought in a policy for high-density schemes and on land in prime West Kent areas we are now achieving values in the region of £2m per acre said Peter Randall.
“In North and Mid Kent land is selling at up to £1.25 million per acre, Ashford in the region of £700,000 and East Kent up to £500,000.
“Sussex is just as restrictive on land supply and values in some West Sussex areas are now approaching £2m per acre. Even single plots have recently sold at over £400,000 and a small site with planning permission for four detached houses received offers approaching £1million.
High density apartment schemes in town centre locations in North and mid Sussex are also generating high land levels says Jack Jay
“And along the traditionally slower coastal regions, any sites with the benefit of planning consent are also now in very short supply and developers are prepared to consider these areas which only 12 to 18 months ago would have been rejected out of hand”