Residential Land Values in West Midlands

Residential land in the UK has been an interesting journey, some sales up and some down, depending on the region. Take Sandwell for example, this area has remained stable with most of the residential land sites being Brownfield. However, the value of the land has been greatly affected due to three factors - shortage of supply, strong demand, and low interest rates.

The benefit seen is with planning policies that encourage increased population. Because residential land sells specific to Brownfield sites are climbing, we believe there will be a continued climb in trend. The thing to remember however is that prices gained from these sales are very, site specific. In addition, the prices represent abnormal costs or remediation needed for development to occur on a particular piece of land. Then when you look at values, this is impacted because of affordable housing and Section 106 requirements.

Another area in the UK of interest is Stoke. A tremendous amount of uncertainty over this area current exists. For example, plans for developing a former football stadium with restaurants, offices, and approximately 150 homes was submitted by St. Modwen, although a decision pertaining to this application has not yet been decided. Some of the concerns over these plans have to do with possible conflicts with a Pathfinder scheme and just the overall vastness of the plan.

For the Pathfinder scheme, the goal there is for 14,500 older properties in both St. Modwen and Stoke being destroyed so 12,000 new homes can be constructed. Another plan of St. Modwen, although it has temporarily been placed on hold, is redevelopment of the former Royal Doulton headquarters. The challenge here is that an overall strategic plan for the area is not yet completed and an additional pottery manufacturer has shown interest in building 138 new homes in place of an older factory.

Newcastle under Lyme is currently receiving significant interest for building, specific to apartment housing. In fact, three additional schemes have recently been announced that would include the building of 100 apartments each. Keep in mind that all of these proposals have been met with some scepticism with concerns of the market already being saturated with apartments. Another potential challenge is that the planning committee has rejected some of the recommendations from its officers, turning one of the schemes down.

Next, you have Wolverhampton, which has had a quiet residential land market with the exception of just a few sales. Of these sales, the majority have been very small developments of infill plots, each holding just one, possibly two structures. Coventry is also seeing a limited change in residential land, actually seeing a reduction of housing sales. Experts stand firm that values in this area of the UK have remained virtually unchanged for the past year.

For Birmingham, we see an extremely strong residential land market. In the southwest region, the Rover Longbridge Plant has been closed, which has created some level of uncertainly pertaining to residential land and housing. Therefore, until the future of that particular plant is determined, the overall impact on residential land will remain uncertain. Finally, in Leek, there is a growing need for apartment housing due to the conversion of redundant mill structures. Even Staffordshire is starting to see more demand for smaller plots of residential land.

- James M

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