In the ever-shifting terrain of the UK property market, a prominent trend is emerging, and it’s centred on new build properties. According to the latest Property Watch bi-monthly survey conducted by e.surv, new build incentives are on the rise, bringing fresh dynamics to the real estate landscape.
These incentives are predominantly aimed at alleviating the financial burdens associated with purchasing property, including deposit contributions, assistance with legal fees, and covering the costs of stamp duty or land tax.
The survey, which polled 500 participants, has unveiled intriguing insights into the market dynamics, especially with regard to new build properties. In a notable statistic, 44% of surveyors based in London reported an uptick in the number of new build homes being let above their initial asking rent. This indicates that despite the challenges faced by landlords, they are managing to command higher rents for these newly constructed properties in the capital.
However, outside of London, the situation paints a different picture. While there is a consistent flow of new build homes for sale across the UK, these properties are generally taking longer to sell. Additionally, asking prices are being squeezed at the upper end of the market. This scenario is putting pressure on sellers and further underscores the need for creative incentives to attract buyers to these new builds.
Furthermore, the survey revealed that 50% of surveyors noted an increase in the number of newly constructed homes being put on the market for sale. This is a noteworthy shift, as it signifies the mounting pressure on landlords to adapt to changing market conditions and diversify their portfolios.
Of the new build properties put up for sale, an overwhelming 90% found new owners who intended to make the property their primary residence, indicating the strong appeal of these properties among homeowners.
Property Watch has sounded a warning about the stresses in the buy-to-let market and their ripple effect on both tenants and landlords, even in the context of new builds. Interestingly, these pressures persist despite the government’s recent announcement to scrap plans for new minimum energy standards, highlighting the complex interplay of various market factors.
As a result of these challenges, the survey found that 79% of surveyors observed a decline in landlords planning to purchase new investment properties, while half of the surveyors saw an increase in landlords planning to rationalise their portfolios or exit the market entirely over the last 12 months. This shift in sentiment within the landlord community indicates a growing sense of uncertainty and a desire to reduce exposure to the buy-to-let market, including new build properties.
One of the most critical takeaways from this survey is the persistent demand for new build rental properties outstripping supply across the UK. A significant 44% of respondents reported a fall in the stock of new build rental properties coming to the market. This demand-supply imbalance continues to put upward pressure on rental prices for newly constructed homes, which could have a substantial impact on tenants.
In conclusion, new build properties are at the forefront of a changing real estate landscape in the UK, with incentives for these properties becoming increasingly prevalent. The challenges faced by landlords, coupled with shifting market dynamics, are reshaping the landscape of new build investments.
As the demand for new build rental properties continues to outstrip supply, it is imperative for stakeholders to adapt and collaborate to ensure a stable and sustainable housing market for all, particularly in the realm of newly constructed homes.