New-builds are selling significantly faster than existing properties at the moment, and the sector is responsible for a boost in the supply of homes for sale too.
A new study by Stripe Property Group has revealed the strength of the new-build sector at the moment, demonstrating robust buyer demand for the property type in recent weeks in particular.
The research shows that new-builds made up 7.2% of all properties hitting the market for sale across the country over the past two weeks, with regional variations in some locations showing an even stronger pipeline of brand-new properties.
Meanwhile, a huge 14% of new-builds that were listed over the past fortnight are either under offer or sold subject to contract, compared with 12% in the existing property realm. As the cost of living crisis and soaring energy bills continue to impact people’s lives, this could have a major part to play in the spike in popularity of new properties.
Supply and demand by region
Across the country, stock levels in the new-build arena show some big regional variations in terms of what’s been listed for sale recently. The East Midlands was revealed to be the area with the highest level of new-builds, accounting for 9.2% of all properties listed over the past two weeks.
In the east of England , 8.5% of newly listed properties were brand new, followed by Scotland with 7.8%, the West Midlands with 7.7% and London with 7.3%.
On the demand side, appetite is higher in almost all parts of the country for new-builds than for older homes, judging by the speed at which they are snapped up once listed.
Scotland sees the biggest craving for the sector, where around 20% of new properties are under offer or sold subject to contract, which is 8.4% higher than for existing properties.
In Yorkshire and the Humber, there’s a 7.5% gap between demand for new and demand for older homes when using this measure, followed by 7.2% in the north east, 4.1% in the east, and 3.1% in the north west.
The only places in the country where existing properties seem to be more sought after, due to how quickly they sell, are the south west, London and Wales, according to Stripe’s research.
New-builds could be the safest bet
With the research showing that people are more likely to lean towards brand-new properties than older ones, there is an argument for there being more benefits to the property type than ever before.
Energy efficiency is a key concept at the moment, and one which property buyers are thinking about more than ever – particularly when considering rising energy costs. With uncertainty also surrounding house prices, the fixed price of a new-build can offer some stability.
James Forrester, managing director of Stripe Property Group, acknowledges that the market has starting showing “signs of wear and tear” due to economic turbulence, which has affected buyer numbers and house price forecasts.
He adds: “Despite this, the new-build sector continues to demonstrate strength and resilience and not only are a consistent level of new homes reaching the market, but the demand for these homes remains substantially higher than the appetite for existing homes across the vast majority of the nation.
“With as many as a fifth of all new-build properties selling within two weeks in some parts of Britain, the sector looks set to weather the current downturn, with new homes continuing to sell, while commanding robust market values in the process.”
Commenting on some recent research by Alliance Fund looking at the rising price premium associated with new-builds, Iain Crawford, CEO of Alliance Fund said: “With many now predicting an end to the pandemic property market boom, a new-build purchase is probably the safest path when looking to negate any downturn in property values over the coming months, as they also hold their value to a far greater extent.”
