According to the latest Land Registry figures, it would appear that property prices of new build homes are increasing at ten times the rate of existing properties.
The average price of a new build home in the UK is now just over £316,000, compared to just over £245,000 for existing housing stock.
There are various reasons for this differential. New build homes are likely to attract a premium price because of their desirability – everything’s new, clean and modern, and it’s easy for home buyers to just move into and start enjoying their new home straight away. But it’s worth bearing in mind the figures cannot compare like for like – for example a brand new 3-bedroom property may be larger and have a much higher specification than an older 3-bedroom property, so a higher price is justified, which won’t be reflected in the survey figures.
As the housing market has slowed down, due to Brexit uncertainty, many people have held off putting their properties on the market. This means that those who really need to move may have had to look at new build options instead and, as in all markets, a higher demand leads to a higher price.
In addition, the Government’s Help to Buy equity loan scheme is only applicable for new builds, meaning many may have bought a new property so they could take advantage of the 5% deposit.
Julia Evans, New Homes Sales Director for smarthomes, commented, ‘New build properties have become so popular, we have set up a dedicated new homes division to focus on marketing and selling local new developments from studio apartments and penthouses to family homes. People are attracted to new builds, despite the premium price, as there’s no chain, no renovations, no hassle, and that has a value associated with it.’
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