As part of its Property Market Report, the Valuation Office Agency (VOA) has been collecting and publishing data on residential development land values since autumn 1983. This has resulted in a time series for the value of three types of site – small, bulk and suitable for flats/maisonettes – at both local and national level. These, together with the local values, have been extensively used by the industry and various government departments, including DCLG.
In 2009, the VOA undertook a review of the Property Market Report, increasing its coverage of the different property sub-markets, but significantly reducing the number of geographical data points covered for residential land. The changes would make any later figures incompatible with the historic data.
While the time-series produced by the original VOA residential land data is not derived from transactions, being based on desktop exercises in which local surveyors estimate the value of typical sites taking into account evidence from the local market, it is one of very few sources of direct evidence on what is happening in the land market, which is so vital for the delivery of both market and affordable housing.
The Homes and Communities Agency considered that there was significant public interest in understanding current trends (particularly in relation to the viability of much-needed residential development) and therefore funded the VOA to continue the land valuation exercise in its prior format, for another two half-year reporting periods (January and July 2010). The only difference between this and previous exercises is that Wales and Scotland are not included. Regrettably, the Agency has been unable to fund further reporting periods beyond July 2010, and so the below data from the VOA remains the most recent. Any further data or reports, although not comparable, are available annually from the VOA directly.
The land values provided are not the results of statistical analyses of actual land transactions. They are hypothetical prices attached to a ‘typical’ site for the area in question, with planning consent for residential development and serviced to the site boundary. The figures take account of affordable housing provision in line with local trends, as well as situations where supply is mostly brownfield.
As these are hypothetical prices, they are not required to be in line with RICS Valuation Standards. They should be treated as illustrative of local land market conditions. They are not definitive figures and should not be applied to specific sites, which will have individual characteristics that will affect value, such as location, servicing or planning status.
The figures provided for regions, England and inner and outer London are simple averages of the data for each area given. As such, they do not take into account the location of available land in each region and/or the geographic size of each area sampled. They are also affected by the number and nature of locations used in each region. Therefore, they should not be taken as representative of each region. Rather, they should be used as a guide as to how the land market as a whole is changing over time within each part of England.
Given these assumptions and provisos, neither the Homes and Communities Agency nor the Valuation Office Agency are liable for any detriment caused by the use of these value assessments.
The headline findings are as follows:
This would seem to concur with reports from the industry and commentators, which suggest that developer and land buyer interest is concentrated on small greenfield sites in the southern half of the country. Such sites are less risky to develop as they require less upfront investment and can be quickly built out. The full data includes location-specific land values, regional and national averages and indications of six-monthly and annual change in prices.