Property market has failed to meet expectations
Two-thirds of developers say property market has failed to meet expectations as Autumn Budget fails to boost confidence
Jonathan Samuels, CEO of specialist lender, Octane Capital, believes that the Autumn Budget has done little to restore confidence across the UK development sector, with the firm’s latest industry insight revealing that 67% of developers feel property market conditions have failed to improve at the rate they expected during 2026.
The latest quarterly gauge of developer sentiment, commissioned by Octane Capital and conducted following the Autumn Budget, surveyed UK property developers to assess market performance during 2026, expectations for 2027 and the impact of the Government’s Your First Home scheme on future development activity.
The research found that 67% of developers believe UK property market conditions have failed to improve at the rate they expected during 2026, whilst a further 15% stated that conditions had improved, but by less than anticipated.
Looking ahead, confidence remains subdued, with almost three-quarters of developers (74%) stating that they do not believe UK property market conditions will improve in 2027, compared to just 26% who anticipate an improvement.
The Government’s Your First Home scheme, announced in the Autumn Budget, also appears to have done little to encourage developers to progress new projects.
Half of those surveyed (50%) stated that the announcement had made no difference to their development or investment plans, whilst 24% said they were now less likely to progress or break ground on projects.
Three-quarters of developers (75%) also believe challenges remain within the current market, with exit risk and slower sales identified as the single biggest obstacle, cited by 33% of respondents.
High build and labour costs followed at 25%, whilst valuation gaps (20%) and funding delays or uncertainty (17%) were also highlighted as significant challenges.
When asked what could help improve market conditions, greater political or economic certainty ranked highest at 35%, followed by increased availability of finance (25%) and stronger buyer demand (21%).
Despite the subdued outlook, half of developers (50%) stated that they definitely intend to utilise specialist finance to help navigate market challenges in 2027.
Development finance emerged as the most widely anticipated form of specialist funding, cited by 31% of respondents, followed by bridging finance at 25%.
Refurbishment or light development finance accounted for 19%, whilst development exit finance and other short-term or specialist lending were each cited by 13%.
The findings suggest that whilst developer confidence remains fragile, access to flexible funding solutions continues to play an important role in helping developers manage uncertainty and progress viable projects.
Jonathan Samuels, CEO of Octane Capital, commented:
“2026 has clearly been a frustrating year for the development sector, with the majority of developers feeling that market conditions have fallen short of expectations and very little confidence that 2027 will bring a meaningful improvement.
The Autumn Budget presented an opportunity to provide some much-needed reassurance, but our research suggests that it has done little to change development intentions. Whilst supporting first-time buyers is important, stimulating demand amongst just one buyer segment alone is unlikely to encourage developers to bring forward new projects when so many remain concerned about sales timelines, build costs and the wider economic outlook.
What developers need above all is greater certainty, alongside access to funding that can accommodate the challenges of today’s market. Specialist finance continues to provide an important route forward, giving developers the flexibility to manage project timelines, navigate slower sales periods and capitalise on opportunities where they arise.”
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