21 Aug Developer difficulties
Richard Potts, Director, Chartfield Homes
What are some of the greatest Brexit driven challenges you thought you would face? How have you gone about mitigating these?
Having worked as a developer for many years, (albeit as an employee) I have seen huge changes in the market; the issue for me was leaving paid employment to strike out on my own. I feel that the greatest issue with Brexit is uncertainty over the process, timescale and outcome and what it will mean for the economy, generally, and the housing market. To mitigate these issues, I am being very selective in the types of developments I view as suitable. The location must be right, the mix of units and sizes must be appropriate for the local marketplace and most importantly, we must not overpay for the land in the first place and start from a weak position.
Considering your previous planning experience, what, from your perspective is the greatest impact Brexit has had on developers?
Considering my previous planning experience, the greatest impact Brexit has had on developers is the uncertainty about the future leading to delays in making financial decisions. This has affected developers due to their prospective purchasers procrastinating and the developers themselves delaying investment in their people and companies.
Your focus as a developer is on large single units, how will you ensure that sales are successfully secured in the current market?
My focus as a developer is on high quality but modestly sized homes (circa 800-3500 sqft). I feel that an increase in design flair is a huge differentiator from the homogenous, low-quality boxes volume developers produce. Individually designed and better-produced home will ensure people.
How do you think the developer approach has changed between now and times of political certainty?
Given any uncertainty in the market volume developers will go into hibernation. They will cut production only to meet provable demand and cease investment in new land. This, whilst prudent on the face of it, is a blunt approach. Inevitably, when the market improves, they are not in a position to ramp up production quickly. They have few new sites and the rate of active sites has slowed down. This approach exacerbates the supply and demand issues we see in the UK market. As a smaller developer, I hope to be more agile in dealing with market fluctuations. This is by taking a more creative approach to land buying and building.
How does your approach to securing planning differ between now and in times of political and economic stability?
Unfortunately, the planning system is such a subjective and needlessly long process. Economic uncertainty that causes delays may well be over before planning permission is issued. When planning consent is granted, reliance on the ability to have negotiated a flexible land purchase contract is required. Likewise, this is to ensure there is room to delay a purchase until the appropriate time.
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