We have a clear indication that the government are creating opportunities within the development sector that brokers should be looking to take advantage of.
In the Government’s housing white paper, it’s clear that they are keen to support the building of new houses across the UK, which is of no particular surprise to those in the industry. However what is key from the report is that the government are keen to support smaller developers who build lower volumes of houses, and also help those looking to enter the market. This is where the opportunities lie.
With 40% of local planning authorities not having an up to date plan to meet projected growth in their respective areas the opportunity is there for niche developers to build smaller developments on parcels of land not wanted by the larger house builders. Another point of consideration is that there will be smaller builders, development sites or borrowing requirements that won’t fit the mainstream banks criteria opening the opportunity for brokers to provide support.
To back this up, the government has launched a £54 million Land Release Fund to help ensure local councils release some of their unused or surplus land for housing.
The aim is to transform local communities and release land for at least 160,000 homes by 2020.
It’s clear that to build the homes we need, it’s vital there is a greater supply of land available to build them. Local authorities are major landowners and so have a crucial role to play in this.
The fact that the government want to support smaller builders and more diverse housing is clearly an opportunity, but developers may not be best served by the high street lenders and more flexible specialist finance will be required. Brokers can be proactive here and target these developers who need the guidance for the right financial solution so I would urge to go looking for them.
This is where Clever Lending can help, not only in sourcing finance with expert product knowledge but also handling the documentation and packaging of more complex projects. Every such case is different and expert underwriters are required to assess each case on its own merits, ultimately saving brokers time and moving the project along to completion as quickly as possible.
Developments need not only be solely residential, they can include mixed-use developments where part of the site is residential. This can be beneficial for the landlords as they can often get higher rents and yields on the commercial element helping to make the overall scheme more viable.
There is also the opportunity within existing developments, and specialist development finance can help developers capitalise on existing property renovations such as offices and commercial buildings, and make them, or part of them, suitable for residential use.
Clever Lending has experience and expertise aimed at helping brokers achieve the desired outcome for a variety of their clients, whether they are dealing with property developers, large companies or private individuals then finding the right finance for their property developments needn’t be as daunting as it first seems.
So although there is a lot of work to do before a project can start, developments can be highly profitable when done properly. After all, the government is keen to build and release land for new housing sites, and master brokers are there to help at every stage and to source the right lender for the project. This makes projects more viable than ever, so why not venture into the world of development, if you’re not already, and create new opportunities for further growth.
Don’t miss them, they’re there if you look!
