Residential property market activity on the rise, say optimistic developers
Property developers in the UK are showing renewed confidence in the residential property market, with optimism fuelled by proposed government reforms and housebuilding goals, according to new data from Shawbrook.
More than half (61%) of surveyed developers anticipate a better market in 2025, with nearly one in five (18%) expecting notable improvement. The findings come from Shawbrook’s latest research involving over 550 UK-based property developers.
The government’s housing delivery ambitions were cited by 28% of respondents as a primary reason for increased confidence. Another 28% pointed to proposed changes in planning regulations that could unlock further development opportunities. An additional 26% said national housebuilding targets had boosted their expectations around land and property availability.
Signs of rising activity are already visible, with 26% of developers reporting increased interest and viewings for their properties. The phasing out of stamp duty relief for first-time buyers, which took effect in April, was named by 23% as a key factor driving early-year market momentum.
Developers also expressed optimism over potential changes to mortgage access for first-time buyers. Roughly 27% said upcoming reforms could support higher demand. Meanwhile, 21% noted that financial conditions have started to ease — both for buyers and for their own operations — due to a drop in labour and material costs.
Lower mortgage rates (20%) and a pick-up in buyer confidence (19%) were also listed among the factors supporting positive market sentiment. Developers focused on new builds or conversions were among the most confident, with 85% expecting the market to improve in the coming year.
Looking back at 2024, two-thirds (66%) of developers said market conditions had improved compared to 2023. Only 13% said the market had deteriorated over the same period.
Complementing Shawbrook’s findings, separate analysis from property platform Zoopla showed a rebound in activity. Its research found that sales and new listings rose by 10% and 11% respectively year-on-year.
“Despite wider economic uncertainty, it’s encouraging that within the residential property market there are green shoots of optimism,” said Terry Woodley (pictured), managing director of development finance at Shawbrook. “It’s evident from our research that the government’s ambitions for the housebuilding sectors have helped to drive confidence amongst developers, and this combined with an uptick in buyer confidence is creating a positive picture for 2025.
“While the impact of the stamp duty relief ending has been the main story for the market in the first quarter of the year, developers will be hopeful that the measures announced in the Planning & Infrastructure Bill will continue to fuel activity across the rest of the year. However, with some of these measures likely to take time to come to fruition, developers will likely still be looking to the government to deliver further effective reform that can boost activity now.”
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