The Market Is the Market — Our Job Is to Understand It

Every three months, I'll look at the same core indicators across the housing and development market. That gives us something far more useful than reacting to individual headlines: we can see how the market is actually changing over time.

We'll track prices, supply, buyer activity, selling times, mortgage and finance conditions, construction costs and significant planning or regulatory changes. But I'll also give you my own view of what I'm seeing and, most importantly, what I think it means for us as property developers and investors.

Nearly Four Decades of Different Property Markets

I can only comment personally on the property market from the late 1980s onwards, because that's when I started.

Since then, I've worked through nearly four decades of very different property markets. I've seen rapidly rising prices and falling prices. Recessions and booms. Periods when finance seemed readily available and periods when obtaining it became considerably harder. I've seen interest rates, buyer confidence, construction costs and development margins change significantly.

And I've watched plenty of people describe those different periods as either a “good market” or a “bad market”. I've never particularly liked those descriptions.

For an investor or developer, describing it as good or bad doesn't really help us make a decision. A strongly rising market may sound attractive, but it can also mean more competition for development sites, higher purchase prices and sellers with greater expectations.

What some people might describe as a difficult market can present completely different opportunities: fewer competing purchasers, more motivated sellers and potentially greater negotiating power.

Different markets create different risks and different opportunities. Our job is to understand the conditions we're operating in and make our decisions accordingly.

Q4 2026 Market Snapshot

This is our first quarterly report, so Q4 2026 establishes the baseline. From Q1 2027 onwards, we'll compare these same measurements with the previous quarter and, as the history builds, the same period a year earlier.

1. House Prices

National house-price figures give us useful context, but they don't tell us whether our development works. There isn't one UK property market. Different regions, towns, price points and property types can behave very differently at the same time.

That's particularly important when we're carrying out a development appraisal. I'm much more interested in good comparable evidence for the type of property we're intending to create than simply knowing whether a national house-price index has moved up or down by a percentage point.

What are buyers actually paying for comparable properties in our market? That's the figure we need to understand.

2. Supply and Buyer Demand

Buyers currently have more choice. The figures we're tracking show around 5% more homes available for sale than a year ago, while sales agreed are around 9% lower.

I don't interpret that as buyers having disappeared. It means buyers can afford to be more selective. And when buyers have more choice, price, location, presentation and the quality of the finished product become increasingly important.

3. What's Actually Selling?

This is probably the most interesting feature of the current market for me. From the research I'm doing and what I'm seeing:

The figures we're following support it. Properties finding a buyer without requiring a price reduction are doing so in around 39 days, compared with around 119 days for properties that subsequently need their asking price reduced.

There is a market. But buyers are price-sensitive. For us as developers, that's extremely important.

4. Pricing a Development Correctly

We need to think about pricing at both ends of a development. First, when we buy. If we're over-optimistic about the eventual selling price, that can lead us to pay too much for the development in the first place.

Then we need to think about pricing again when the finished development comes to market. I would rather see us launch at a price buyers recognise as representing value and potentially create competition than spend months chasing an unrealistic asking price.

An extra two or three months isn't simply an inconvenience to a developer. It can mean additional finance, council tax, utilities, insurance and other holding costs. Time costs money.

5. Don't Build an Appraisal Around an Asking Price

We shouldn't take the highest asking price we can find on Rightmove and use that as evidence for our GDV. An asking price tells us what somebody would like to achieve. I want to understand what comparable properties are actually achieving.

The more realistic we are about the exit value at the beginning, the better informed our decision about the purchase price becomes.

6. Mortgage and Finance Conditions

Bank Rate currently stands at 3.75%, while mortgage costs remain considerably higher than they were earlier in 2026. That matters because the person eventually buying our finished development may be relying on mortgage finance.

For us, the important question isn't simply whether mortgage rates are rising or falling. It's: how do current borrowing costs affect the buyers we're ultimately targeting? Development finance and holding costs also need to be properly reflected in our appraisal.

7. Construction Costs

Construction costs remain another important part of the equation. The figures we're tracking show material prices still higher than a year ago. It's a cost we need to understand and allow for.

If our build costs increase, something else in the appraisal has to absorb that increase. That's why realistic construction budgets and sensible contingency remain so important.

8. Planning and Regulation

We'll use this section every quarter to highlight material changes in planning policy, Building Regulations or other regulation affecting development. I don't intend to fill it simply because we've created a heading for it.

If nothing significant has changed, we'll say so. But when something changes that could affect what we can build, how long something might take or the viability of a development, we'll look at the practical implications.

What Does This Mean for Us as Developers?

Ultimately, we aren't buying the UK housing market. We're buying one development.

What can we buy it for? What can we get out of the site? What will planning allow? What will it cost us? How long is it realistically going to take? What will the finished development genuinely be worth? How long might it take to sell? What happens to our profit if costs rise or our eventual selling price is lower than expected?

If it does, the fact that somebody somewhere is pessimistic about the housing market shouldn't automatically stop us buying it. Equally, when everybody is optimistic and property prices are rising, that doesn't mean we should pay too much for a poor development.

The individual deal still has to work. Some of the best opportunities can appear when other people are concentrating on how difficult they think the market is.

The Q4 2026 Baseline

We'll return to these same indicators in Q1 2027. Rather than starting again with a completely different market article, we'll ask: what's changed?

Methodology: Keeping the Quarterly Comparison Consistent

Each edition will use the same primary sources wherever possible: Rightmove for asking prices and selling-time measures; Zoopla for its house-price measure and sales-market activity; the Bank of England for Bank Rate and lending context; and official ONS / government construction data for build-cost measures. The latest available observation at the start of each quarter will be recorded, with the period it relates to clearly stated.

Market data is context, not a valuation or forecast for an individual property. Development decisions should be based on site-specific appraisal, comparable evidence and appropriate professional advice.