Despite cooling market conditions, the average price premium commanded by a new-build property has increased by 20% in the last year, now 52% higher than the average value of an existing home.
This is according to research from Sourced Franchise, the property investment platform.
Sourced Franchise analysed current new-build values, the premiums attached when compared to existing property prices and how this premium has changed over the course of the last year.
The research shows that, with the average UK new-build now valued at £425,186, the premium commanded by new homes currently sits at 52%. What’s more, this premium has increased by 20% over the course of the last year alone.
Regionally, the North East is home to the strongest new-build house price premiums, where new homes currently command £271,723 – 83% more than the average home in the existing market.
The current premium commanded by new-build properties also sits at more than 60% across Scotland (72%), the East Midlands (66%), the North West (65%), West Midlands (63%) and Wales (62%).
At 17%, London is home to the smallest new-build house price premium in the current market.
Not only do new-builds continue to command impressive premiums, but this premium has also increased over the last year.
In the North East, the average new-build house price premium has increased by 25% over the last year, with the North West (+24%) and Scotland (+24%) also seeing similar rates of growth.
Sourced Franchise director, Chris Kirkwood comments: “It’s fair to say that the residential market is stuck in a rut at present, with increasing interest rates causing many buyers to sit on the fence, causing a reduction in market activity, while house price growth has also stalled in recent months”.
However, Kirkwood insists the market is far from on its knees and new-build properties have not only continued to hold their own when it comes to the price premiums they command, but these premiums have also grown considerably over the last year.
He concludes: “This demonstrates that the appetite to deliver new homes to market remains strong which suggests that the nation’s housebuilders are unphased by current market uncertainties and have a positive view of the long-term outlook for the market.”
