Does Covid Present an Opportunity to Build or Certain Development Death?

Brett Alegre-Wood
October 24, 2020

Act now or wait until later?

With so many lenders tightening criteria and the market being unsure of direction it could be the opportunity to build or the death-nail for your profits.

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Should you build? I'm assuming this you're talking about development here. As long as you price in the market and look as long as you bought the land well and you price it well then things are still selling. Things are still going to continue to sell you know, chatting to a few of the developer buddies I have, you know larger developers they're not seeing a massive drop they're not planning on a massive drop.

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It's a very different market in Scotland, it's a smaller market. There's some fundamental changes namely oil and gas with all the issues there and that I know Aberdeen and a few of those places house prices have dropped considerably. So, it depends on how that's reacted.

If anything, if there was a massive drop London benefits from that, London does okay and now with Manchester and Birmingham being world cities they will too to a degree. The problem is a lot of lenders now have changed their quantum in other words the minimum amount of land and so really Manchester and Birmingham are almost placed off the charts, unless you're buying something in a city centre. 

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You know London is still fine but I think what they've done is they've sort of tightened their criteria and a lot of people have done that. As long as you build it then, I think you can still sell. I don't see this as for me this recession is not going to be a you know everything stops everything dead. What's going to stop that from happening is the government will do whatever it needs to stimulate the economy to make sure whilst we might have a bit of a fall-off that actually won't be a dead drop. Most countries around us have almost an unwritten law to say that's how we're going to treat it.

Video Transcription

Should you build? I'm assuming this you're talking about development here. As long as you price in the market and look as long as you bought the land well and you price it well then things are still selling. Things are still going to continue to sell you know, chatting to a few of the developer buddies I have, you know larger developers they're not seeing a massive drop they're not planning on a massive drop. If anything, if there was a massive drop London benefits from that, London does okay and now with Manchester and Birmingham being world cities they will too to a degree. The problem is a lot of lenders now have changed their quantum in other words the minimum amount of land and so really Manchester and Birmingham are almost placed off the charts, unless you're buying something in a city centre. You know London is still fine but I think what they've done is they've sort of tightened their criteria and a lot of people have done that. As long as you build it then, I think you can still sell. I don't see this as for me this recession is not going to be a you know everything stops everything dead. What's going to stop that from happening is the government will do whatever it needs to stimulate the economy to make sure whilst we might have a bit of a fall-off that actually won't be a dead drop. Most countries around us have almost an unwritten law to say that's how we're going to treat it.


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