According to the latest report from Savills, greenfield values fell by an average of -0.9% in Q1, masking significant regional variation. Values fell by -2.1% in the South East, while Scotland saw an increase in +3.3%.

The urban land market continues to face headwinds, falling by -1.4% in Q1, bringing annual falls to -5.8%. This reflects limited appetite for flat-led schemes across much of the country due to ongoing viability challenges. The London land market held steady in both Outer and Central London, suggesting a potential floor in values after several years of decline.

Diverging greenfield activity

PLC housebuilders have reported a slight improvement in sales at the start of the year, averaging around 0.6 sales per outlet per week. In contrast, SME developers remain under pressure, with no uplift recorded in Q1.

Developers delivering between 500 and 1,000 homes annually have seen sales per outlet fall by around 40%, declining from an average of 33 homes per year in 2021 to just 19 in 2025. The greatest drop in activity has been felt in less affordable markets across the South East, South West and East of England.

With little improvement in the sales market, housebuilders are showing more caution and seeking to eliminate risk where possible from land buying, prioritising oven-ready sites with full planning consents. PLCs are also targeting smaller sites to keep upfront costs down, while parcel sales between housebuilders have become more common as a means of supporting cash flow and boosting outlet numbers.

As a result, bidding activity on most sites in southern markets has declined, with developers focusing on prime, well-located opportunities where competition remains heavy. Key economic hubs such as Brighton, Oxford and Chelmsford have seen values hold steady, while secondary locations have experienced more significant downward pressure.

In contrast, greenfield values in the North and Scotland have continued to rise, underpinned by resilient housing markets, greater affordability headroom for homebuyers, and an ongoing shortage of land supply.

Urban viability remains under pressure

Appetite for urban land remains low across the country, with challenges of high build costs and building safety regulations posing a threat to scheme viability. The largest falls were seen in the regions with lower housing affordability, with the South East and East seeing falls of -2.6% and -2.2%, respectively.

Where activity is taking place, it is largely focused on Build to Rent and Co-living schemes, though developers remain selective in the locations they are prepared to build.

Hamish Simmie, Associate Director in Savills Research, commented: “Q1 saw a clear regional split in the land market. Without any buyer-side support, new home affordability in the South is likely to remain under pressure, reducing housebuilder appetite for land. By contrast, greater affordability in Northern regions, combined with constrained land availability, should mean continued competitive interest for well-located sites. Although there has been an uptick in planning activity since the revisions to the National Planning Policy Framework in December 2024, decision times remain lengthy, meaning it is unlikely we will see a drastic increase in supply coming forward this year.”

Patrick Eve, head of UK regional development at Savills, adds: “Across the country, build costs and viability will remain challenging. The Future Homes Standard, confirmed at the end of March, will come into effect on all new-build homes from 2028 to ensure they are ‘zero-carbon-ready’, adding costs that will need to be reflected in land bids. There is also economic uncertainty around the conflict in the Middle East and its potential impact on materials, build costs, debt and mortgage pricing. As a result, we expect a cautious market and a strong preference for oven-ready sites to continue defining activity in the months ahead.”

Read the full report here.