New build sector shows regional strengths
According to research by SmartNewHomes.com, the average cost of a new build home fell slightly by 0.3% over December.
[UKPRwire, Mon Jan 28 2008] According to research by SmartNewHomes.com, the average cost of a new build home fell slightly by 0.3% over December. This was the first drop in two months and represented the expected seasonal fall over the Christmas period. Averaged out over the last quarter of 2007, new build prices were up by 1.2%, indicating that this sector of the housing market is relatively healthy in the face of property price falls across the country.
The average cost for a new build property in the UK is £259,995, but there was significant variation by region and by type of property. As in the previous month, new build growth was led by penthouse properties, which showed an average 5.2% increase. The penthouse sector appears to be unaffected in an otherwise shaky housing market suffering from the fallout of the credit crunch and subprime lending crisis. The cost of apartments and detached properties, however, fell slightly.
On a regional basis, London and the southwest each showed a 9% increase in new build prices, Wales a 3.1% increase, and East Anglia a 2.6% increase. In contrast, the northwest did poorly, recording price falls of 2% in December and a 7.1% fall in the last quarter of 2007. Scotland and the northeast also experienced sharp falls of 7% and 6.7% respectively, while costs in the East Midlands were down by 5.5%.
As well second-home buyers and young professionals buying penthouses, the new build sector is also trying to attract new buyers struggling to get on to the property ladder. “Developers are competing in offering incentives and favourable deals to buyers, such as the payment of stamp duty and fully furnished properties,” said Lawrence Smith of Decision Homebuyers. “So , especially for those buyers facing financing difficulties in the current tough market conditions, new builds may well offer greater affordability and choice.”
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