UK Residential’s Flight through Turbulence

Suraj Lakhanpal, Business Development Director

Navigating Headwinds and Tailwinds facing the Housing Market and Future Living Trends …


One may wonder when we will truly appreciate the magnitude of the pandemic’s global impact on the everyday way of living in the UK. Hybrid working has transformed lifestyles, making optimising space in our homes more important than ever. Add to that, the energy price squeeze and cost of living headwinds, making the journey to a new norm longer and more turbulent. But what about those knock-on tailwinds that help our flight accelerate towards our desired destination? Here we observe how headwind events, impacting the housing market, often lead to positive tailwind innovation effects, and to stay relevant, the need to stay on top of future changes affecting the housing market.

It comes as no surprise that Rightmove recently observed that garden offices are now amongst the most sought-after house feature; suggesting the meteoric rise of video conferencing software is here to stay. Indeed, these software tech firms are investing huge sums in the future digitalisation of meetings taking place in the Metaverse. Will VR headsets soon become essential work equipment, to engage with colleagues in your firm’s Metaverse office? Will your avatar, or digital twin, be dressed in formal or casual attire?

Awareness of making UK homes greener, as a critical step in the roadmap towards Net Zero by 2050, is well-known. It is very much seen as the ‘Plan A’ in ticking off the ‘E’ in ESG agendas for most firms operating in the residential sector. For developers and builders, however, new building standards mean more headwinds to navigate; notably a ban on fossil fuel heating systems in new homes from 2025. For larger schemes, that means adoption is needed now to ensure later phased homes are compliant with new rules. Now exacerbated by prevailing energy cost crises, carbon-efficient homes not only mean cheaper bills, but also premium values due to demand from buyers and renters alike.

Whilst new homes and those older stock requiring mortgages will allow the government to lever policy incentives, what about the 10M+ homes owned outright? Whilst energy price spikes will enhance payback periods on green improvements, it remains uncompelling. Rightmove also observed that buyers are starting to negotiate offers factoring in the cost of green improvements. Could the energy crisis be the headwind that pushes older households to finally change flight, to smaller, more-efficient homes so they maintain living standards? In turn, this could become a catalyst that enables younger generations, in their prime home-buying years, to improve older, low-EPC homes stock via greener retrofitting works; ultimately, a tailwind towards destination Net Zero?

The UK’s housing supply-demand imbalance and affordability factors are likely to take several years to fix. Fingers remain firmly crossed that planning departments can be fuelled by government policies towards quicker decisions abilities, to help keep the UK’s housing pipeline engines switched on at least. The coming months may well define currents and effects on house prices – will those doom and gloom headwinds or the supply squeeze in new stock prevail? Future government and monetary policies need to consider proportions and types of home sales sensitive to rising rates in a supply-constrained environment. At what level could interest rates overcome affordability and weigh down on home sales pricing and/or volumes?

A tough set of questions to answer. With a significant pipeline stuck in what feels like a nationwide planning bottleneck, no quick fixes seem possible to cure the shortage of new homes built in recent years. So, in a fast-changing environment, arguably yet to fully embed the global pandemic’s disruption to how we live and work, one could argue that the case for innovation has never been more critical in recent times. Microsoft’s CEO, Satya Nadella, is unequivocal in his belief that “The next 10 years will be a historical inflection point for digital technology, acting as a deflationary force in an inflationary world”. Seeing it as “…the only way to navigate the headwinds we are confronting today.”

How our work and home lives evolve over the next few years remains uncertain in these turbulent times, but looking out for the longer terms of goals and how they apply to construction and the latest living trends are more important than ever to be able to negotiate the headwinds.

Development Finance With BLG

BLG are a leading principal lending specialist in property development finance, we are positioned to help you. Providing residential and commercial finance ranging from £1 million to £15 million we have the ideal skill set to lend and advise. Priding ourselves on fast decisions and flexible terms we can aid you through these turbulent times. Contact our financial experts today who will take the time to get to know you and your aims.


“We have used BLG for development finance for over 8 years. During that time we have found their knowledge and expertise in the property development industry to be second to none. Their loan process, pragmatic and flexible approach to lending and flexibility when required has supported our business needs throughout the period and provided us with support to deliver new homes in Bristol and the surrounding areas.”

“As property developers you never know the curve balls that you may get and a project that is great on paper may prove a bit more tricky.  This happened to us on a project that BLG have funded and throughout they have supported us.  Our business likes to be collaborative and when we hit those tough moments it really felt like we were working as a team with BLG.  If you have a decent project you can get it funded, but what you really need is a business that is there to support and advise you as well.  For us on this project it was BLG.”

“I approached BLG Development finance with an opportunity I had in Chesham, Buckinghamshire, to build 5 new build houses in 2021. My main contact was Anil Bains who is a Director covering Asset Management. Within very quick timescales, BLG provided me with indicative quotes in regards the finance levels they could offer me. Having considered those levels, I requested a valuation to be carried out which again was dealt with swiftly. We proceeded to completion. The build went very smoothly with monthly monitoring being carried out by BLG and monthly drawdown requests dealt with in a very timely manner. Due to a difficult time generally in the market in regards selling, I was in need of a six-month extension to the loan which again was appraised very quickly and granted. Having dealt with numerous funders over the last 20 years, I can only speak highly of my personal experience with BLG and would very confidently work with them again on any future projects. “

"From our side it has also been a pleasure working with BLG and the team there. We have found you easy to deal with, proactive in resolving any minor issues that have arisen through the project and shown great flexibility in working with us as a partner. We will certainly like to work with you on future partners."

“I really appreciate your hard work. We really like the way you communicate & I must say I haven't seen many people who are that approachable.”

“A very efficient processing team, dealing with the DD once deal credit approved, through to completion”

“Many thanks for your efforts on this one and getting it approved and sorted so swiftly, very much appreciated. I am sure I will be speaking to your over the coming months.”

“We had other funding options, but chose to use BLG again, as we work well with the team, who always provide very clear information and advice with a friendly approach throughout the funding process. Very efficient and always very helpful.”

“Many thanks Anil, it’s been a real pleasure working with BLG so far.  We’re lining up the next project too”

“We would recommend all staff we have dealt with at BLG, as we are very satisfied with the team and the initial offer/terms presented, then you and the funding team, through to the draw down team at valuation stage.”

“All documents are clear and the way you keep clients informed, all the way along the funding process, is refreshing for us”

“With regard to what should be improved at BLG, we work with many lenders in our business and we do not get the help and response we have had on the two projects with all at BLG on our funding for our developments.”

“We would particularly mention Dave Edwards and Tom Pitts as being central to having a smooth working relationship and being positive and helpful at all times. Their guidance in helping us navigate the project from inception to completion was invaluable. As was their patience, particularly at the beginning. We look forward to many future projects with the BLG team.”

“We would like to express our appreciation for your support on our development in Bristol. We were very pleased that, from the outset, you shared our vision of the project to convert a dated but classical building, that had outlived its usefulness as a school, into unique luxury apartments with views overlooking the city. We found our dealings practical and streamlined. Monthly payments were processed in an efficient and timely manner.”

“BLG are very good at communicating with clients and all documents are very clear and all at BLG are always happy to help.”

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