Have you been thinking of buying a new build home? Most people are prepared for what is known as a 'new build premium', or price mark up added to new properties because you will be the first to use it, much like a new car. But how much of a mark up is reasonable, and how do new builds around the country compare to the existing housing stock?
New research* reveals that many parts of the UK are seeing new build premiums at levels that are, frankly, unacceptable. Even in areas of the country where housing is supposed to be more affordable than in the infamously unaffordable South East of England, new build prices are surging.
Want to buy a new build in Wigan? prepare for an average price of £221,330, which is a 71 per cent mark up on the average cost of housing in this area. In Caerphilly, the average cost of a house is £133,980, but it's £242,079 for a new build – a difference of 81 per cent. Gravesham in Kent 'boasts' a 95 per cent new build premium, but the very worst is Harlow in Essex where the average new build costs £551,089, 108 per cent more than the average cost of £265,249 for existing stock.
The argument for new build properties costing more is that they offer higher quality and more energy efficient accommodation than existing housing stock. The reality, however, is different, with the number of complaints about issues with new housing (opens in new tab) (everything from insulation and condensation to plumbing) having increased since 2015. It seems that the trend for branding all new housing as 'luxury housing' in many instances does not live up to the name. In other words, buyer beware.
*Research by estate agent Springbok Properties (opens in new tab), based on the most recent Land Registry figures.