Figures released on Monday in the whathouse.com New Homes Index reveal that the total number of people searching for new build homes decreased -24% month-on-month in August – traditionally a quiet period for the housing market, thanks to the main school summer holidays.
However, behind this headline figure there are several pockets of positivity, as search demand within the Luxury, Retirement and Part Buy Part Rent sectors remained robust.
Retirement new build property searches increased +10% in August compared with July – an unsurprising result given this demographic’s freedom to travel outside the school holiday peak and focus on other issues over the summer.
By region, the biggest retirement search increase was for Scotland (+125%), followed by North East England (+86%) and Wales (+50%).
Luxury property searches for four-bedroom-plus new homes also rose by +10% in August, with the biggest month-on-month increases coming from London (+200%), North West England (+71%), and the West Midlands (+25%).
While Help-to-Buy searches decreased by -20% in August in comparison with July (a not unexpected result given the combination of school holidays and the imminent end of the Help-to-Buy equity loan scheme), interest in Part Buy Part Rent (Shared Ownership) continues to grow. Searches within this sector rose by +16% overall in August, in comparison with the previous month.
Yorkshire and The Humber was by far the most popular region, demonstrating a +57% rise in search month-on-month. However, every region except London, North East England and Scotland experienced strong double-digit growth, suggesting that more people across the UK are keen to pursue this option onto the property ladder.
Daniel Hill, Managing Director, whathouse.com said, “A drop in overall search numbers is to be expected for August, as many prospective buyers are distracted by the school summer holidays – and this year, thanks to post-COVID, pent-up demand, summer holiday bookings really surged.
“But even during this traditional quiet period, it is heartening to see search demand increase for the key Retirement, Luxury and Part Buy Part Rent sectors.
“With so much political and economic uncertainty, it’s extremely difficult to predict what will happen in the fourth quarter of the year.
“The ongoing cost-of-living-crisis – and especially escalating energy prices – will of course have an impact on housing affordability.
“However, the fact that energy efficiency is now top-of-mind for many home buyers is a big positive for new-build homes, which are usually significantly cheaper to run than older, second-hand properties.
“While the prospect of further interest rate rises is likely to dampen demand up to a point, it’s unlikely to deter the more urgent/serious buyers who are committed to moving, and are incorporating potential rate rises into their financial planning.”