What January told us about the development market

Funding gaps, rising build costs and the signals coming through from developers and senior lenders

January painted a clear picture for the Property Box Finance team: almost 1,000 units and £384m GDV came through with real funding gaps attached. These won’t all turn into live deals but collectively they tell a very real story about developer pressure and lender behaviour.

It wasn’t the volume that stood out - we’re not trying to be a volume lender - but what that volume says about the market. Developers are working hard to retain control. Senior lenders want partners they genuinely trust. And the first few weeks of 2026 haven’t eased the pressure. BCIS is already flagging rising build costs this year, driven by labour inflation and skills shortages, with the 2.5% rise in tender prices in Q4 2025 now carrying straight into 2026.

This is the space we sit in.

We might be a small cog in a big machine but we work hard to be a useful one, supporting senior lenders and developers, not adding layers or noise. Staying close to borrowers, lenders and live sites means we can respond quickly when costs move or packages tighten.

We’re always keen to hear what others are seeing on the ground:

• Where are build costs shifting most on your schemes?

• What’s being re-scoped or streamlined to keep projects viable?

• How are you balancing the push to get on site with the need to lock down packages for cost certainty?

The clearest picture of the market rarely comes from dashboards. It comes from the people dealing with it every day.