New build property prices surge in January

February 27, 2018 / Isla MacFarlane
New build property prices surge in January

In the year to end January 2018 new build house prices rose on average by 9.8% across the UK, up on last year’s figure of 5.8%, according to the LSL New Build House Index.

The number of new build properties sold also jumped in January. Of the 116,795 sales the Land Registry received for registration in January 2018, 16,685 were newly built, a 15% increase on January 2017.

The Help to Buy scheme has been a key driver of sales. Equity loan transactions now represent about one third of new build sales. The scheme comes to an end in 2021 and some forward planning will be needed to prepare for this change in the demand base.

Current reports suggest a 40% increase in new properties of all types being marketed in the UK in January, when compared with December’s levels.

Around 10% of UK towns and cities saw new property listings more than double and about 48% saw new listings increase by 50% in January, according to analysis by House Simple. Only six saw a fall in supply from December’s level.

London saw a substantial 79% increase in supply with the Borough of Hillingdon seeing an increase of 118.7%. All of the London Borough’s saw increases with Hillingdon, Bromley, Havering, Waltham Forest, Barnet and Bexley all with rises of 100% or more.

Regionally, the South saw the greatest gains – with five of the top 10 biggest risers. Solihull (West Midlands) saw rises of 145%, followed by Southend on Sea up 141%, Salisbury was up 127.3%, Rugby was up 120.7% and High Wycombe was up by 117.5%.

However, there is an historical trend of homeowners choosing to market their properties in the New Year. The difference this year being that that the seasonal spike was more pronounced than usual.

The reports do not differentiate between second-hand and new-build property types. None the less, any increase in sellers increases the number of potential new home buyers.

“A report from House Simple has found a larger than expected increase in new sales listings in January so perhaps this is an indication that more sellers will be entering the market this year,” the LSL New Homes Index said. “If so, then estate agents will be pleased as they have reported a shortage of property coming to the market over a sustained period.”

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