The UK’s development land market has been described as ‘cautiously positive’ in a new report which also reveals an eight-year high for the net balance of sites coming to the market. However, the latest research by Savills also indicates development land values have softened slightly. In the South East, which includes the Central South, greenfield land values fell by -0.4% in Q1 2025, taking the total annual change to -0.2%. Meanwhile, urban values in the region fell by -0.6% in the last quarter, taking annual change to -0.7%.
Economic uncertainty in the UK has resulted in a more cautious approach from buyers. The recent announcement of the US tariffs, which resulted in the global stock markets suffering significant falls in the days following, arrived alongside a more muted economic outlook, with mounting cost pressures persisting, offsetting any potential growth in land values and particularly impacting brownfield land. These include ongoing build cost inflation, viability challenges and the introduction of policy measures such as the Building Safety Levy.
Revisions to the National Planning Policy Framework (NPPF) in December 2024 has generated enthusiasm among landowners to bring sites forward. It is too early for this to have an impact on supply but, over the last quarter there have been signs of an increase in supply.
The Savills development agent sentiment survey suggests a reasonable amount of activity in Q1 2025, with the net balance of the number of sites coming onto the market at 35%, the highest level seen since Q1 2017. Some developers are becoming more selective, seeking the best sites in the best locations. This is partly driving the softening in greenfield development land values in Q1 2025.
Overall, the market has remained steady over the last quarter, with little change in values. Greenfield values fell slightly in the West and South East, while they rose by 0.1% in the East and North. Similarly, urban values declined slightly in the West and South East, while values remained unchanged in the North, and increased by 0.2% in the East.
| Greenfield | UK | South East | East | Western | North | Scotland |
| Q1 2025 | -0.1% | -0.4% | 0.1% | -0.3% | 0.1% | 1.9% |
| Annual change to March 2025 | 1.3% | -0.2% | 0.8% | 1.8% | 2.1% | 5.9% |
| Urban | UK | South East | East | Western | North | Scotland |
| Q1 2025 | -1.0% | -0.6% | 0.1% | -1.7% | 0.0% | -3.6% |
| Annual change to March 2025 | -1.9% | -0.7% | -0.3% | -2.1% | 0.3% | -8.4% |
Source: Savills Research
Lydia McLaren, Associate Director with Savills Research, says “While an uncertain wider economic outlook is dampening appetite for land, the market has remained steady during the last quarter. This is accompanied by early signs of more supply coming onto the market as we start to see the initial impact of the NPPF changes announced in December 2024 play out in the land market. Overall, there is cautious positivity in the market, especially for strategic land where appetite is heightened with many parties viewing this parliament as a window of opportunity to secure a position on grey belt sites, particularly in the South East.”
UK greenfield and urban values soften in Q1 2025
Source: Savills, Nationwide, HBF, BCIS
Jonny Kiddle, head of Savills South Coast Development team, adds: “In the last six months, the development land market has experienced a good level of activity however various factors have tempered greenfield land value growth. The current level of economic uncertainty will impact confidence in the land market, as buyers will be tempted to delay deals until the impact of the trade tariffs on the UK economy becomes clearer.
“It is evident that we are moving towards a better supplied land market – though any significant change in the volume of consents will take time to feed through to the land market. While a better-supplied land market is expected to temper land value growth, this impact is unlikely to materialise in the short term.”
