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The Regional View: The South West

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Paragon Development Finance Relationship Director Oli Thompson recently spoke to South West Business Insider about our focus on the South West of England and what we are currently seeing from developers in the region. Read his views below.

“Supporting developers across the South West has long been a focus for us as a business. We have always appreciated its popularity as an area to relocate or invest in a second home, however the pandemic has brought new focus to the region’s appeal.

Many of our clients are reporting strong sales agreed off plan, often at a premium to the underwritten values or even marketing prices. The region appears to be maintaining strong levels of demand in the geographies we have a presence including a range of project types across Cornwall, Bristol, Bath and Exeter.

Bristol, Bath and Exeter continue to offer an attractive proposition for buyers relocating from London and the South East. Property is still relatively good value for money for those selling a property in London and the more rural, community feel of the South West is often cited as a draw to the region. Typical buyers will seek homes in towns and villages within close proximity to the Bristol and Exeter trainlines, providing excellent connectivity into London as well as more space for home office space to reflect modern working patterns.

Further into Devon and Cornwall the demand for second homes and investment properties has grown significantly since the beginning of the pandemic. The Stamp Duty holiday coupled with the increasing popularity of UK staycations (even before the pandemic) makes this an attractive asset class for investors. New build properties are particularly popular with this demographic given the lower maintenance costs.

We have found the South West to be dominated by local property developers with excellent knowledge on their chosen micro location. This is essential when it comes to appraising sites, project design and marketing. That local knowledge extends to their subcontractor base which is more reliant on local labour and ultimately seems to have coped well with the challenges of the pandemic.

There is a strong community feel between many of the SME developers operating in the South West and it delights us to be working with so many of the key players.

In terms of locations where we’re seeing strong activity from developers, we have a concentration of current developments in Cornwall, including a scheme for 46 new homes in Fowey, whilst Bristol and Exeter are always busy with new schemes. One development that stands out in Bristol is a conversion of office space into 44 new apartment right in the centre of the city. Many of these have already sold off plan.

However, there are schemes dotted across the entire region, ranging from 40+ home new build developments to interesting refurbishment schemes, such as the redevelopment of the former Swindon Advertiser offices in Swindon Old Town into office space and apartments.”

Extracts from this article were featured in the August edition of South West Business Insider. Read the article here (subscription required).

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Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551