Residential development land has dropped by a third in value over the past year, and by up to 15 per cent in the past quarter, as problems among housebuilders have accelerated the devaluation of increasingly fallow land banks.

The losses in land values around the country are worse than many had feared, according to Knight Frank’s first annual development land index. The property consultancy expects values to continue to fall, predicting that 10 per cent could be further wiped off prices over the next 12 months.