Almost two thirds (65%) of developers plan to increase their investment activity in the North substantially over the next two years, setting the region up to become the next hotspot for UK property development.

In a national study commissioned by finance specialist Together, 57% of developers earmarked the North East as Britain’s most opportunity-rich region. This was followed by the North West (42%), Wales (40%) and Scotland (38%), and trailed by Yorkshire and Humberside (22%) and the South East (13%).

Property developers are almost unanimously supportive of the government’s Northern Powerhouse initiative, with 96% describing it as having had a positive effect. Some 64% said it has been ‘very positive’.

“Given the uncertainty around Brexit and the prospect of tougher economic headwinds, it’s encouraging to see developers remaining so bullish, particularly when it comes to the North,” comments Andrew Charnley, head of corporate relationships at Together.

“Our own experience reflects these findings having supported a significant number of new developments in the North with a healthy future pipeline too. The chronic supply/demand imbalance in residential housing is creating the biggest opportunities yet many developers continue to be hampered by obstacles such as a shortage of suitable sites and access to finance.”

According to the study, houses and flats offer the biggest development opportunities in the North of England, selected by 91% and 80% of respondents respectively. Semi-commercial properties came next (42%), followed by Bed and Breakfasts and restaurants (28%).

The survey also highlighted the main worries of property developers, with half (51%) citing a shortage of available sites, insufficient access to finance (47%) and a lack of government support (40%). A third (33%) of developers worry about Brexit uncertainty.

The table below shows the areas of the country where property developers see the most and least opportunities over the next two years: