The property price premium paid by new-build homebuyers has increased by 10.8% in the last year, with new homes now commanding 40.2% more than existing properties across the British property market.
That’s according to an analysis of new-build house prices by new-build sales optimisation platform, Unlatch, who analysed the current price premiums found across the new-build market and how they have changed compared to the same period in 2020.
The research shows that at an average price of £351,002, new-builds in Great Britain are 40.2% (£100,591) higher than the average price of an existing property (£250,411). Just a year ago, the average new-build price premium sat at 29.3%, meaning that the price gap between new homes and the existing market has grown by a respectable 10.8% in the last year alone.
Largest new-build price premiums
In terms of the outright price premium commanded across the new-build market, the North East ranks top where new homes cost 65.4% more on average compared to the wider market.
Scotland is also home to one of the most robust new-build markets where property values are concerned, with a current premium of 57%, while new-build premiums in the East Midlands also sits above 50% (52.5%).
At a local level, Harlow (114.9%), Blaenau Gwent (104.8%) and Gravesham (100.5%) are the nation’s new-build price premium hotspots, where the average new home sells for more than double that of existing properties.
Largest new-build price premium increases
The North East also ranks top in terms of the largest increase in the price premium seen across the new-build market. The region has seen a 14.1% increase in new-build price premiums when compared to this time last year.
Wales ranks second with new home premiums climbing 13.3% in the last year from 36.2% to 49.5%, with the East Midlands again completing the top three at a regional level with a 13.2% increase.
Harlow also ranks top at a local level, with the premium paid for new homes increasing by 10.2% in the last year, while the City of Aberdeen (9.9%) and East Ayrshire (9.9%) take the second and third spot.
Lee Martin, Head of UK for Unlatch says:
“The pandemic has been particularly problematic for the nation’s housebuilders who have endured a range of setbacks, from workplace restrictions to a steep increase in the cost of materials, while attempting to satisfy a huge level of buyer demand.
The good news is that the new homes market is thriving and those that have managed to traverse the difficulties posed by the pandemic will have been handsomely rewarded for their efforts.
Appetite for new homes is alive and well and not only do new-build properties continue to command a healthy premium in the current market, but the size of this premium has increased notably in the last year alone.
It’s an exciting time to be in the sector. We’ve seen the use of innovative technology solutions continue to evolve the new-build proposition, not only helping housebuilders to streamline the construction process, but also improving the experience for buyers in terms of a faster, more manageable transaction process.
With the government also opening up the nation’s brownfield sites, we expect the new homes market to go from strength to strength in 2022 and beyond.”