Why buyers go the extra mile to invest in a new-build

 

Areas of major regeneration have the capacity to attract significantly more new-build buyers. A new report looks at these trends, and it could help property investors decide on their next location.

In the UK, people are more likely to move further to find their ideal new-build home, the latest figures show. Compared to a second-hand property, good quality new-builds are increasingly sought after, and this attractiveness applies to both homeowners and property investors.

According to Savills, those buying new-builds will move 56% further than those buying existing homes. In numbers, people move an average 3.2 miles for a second-hand property, compared to five miles for a new one.

Top new-build locations

The location of a new-build is important, says the report. Savills analysed buyer trends since 2017 and found that there are two main migration patterns. One is of people buying new-builds close to London, in the outskirts of the city or around the commuter belt.

The other is a north-westerly trend. The data shows that new-build buyers move along a north-west axis from London towards areas like Birmingham, Manchester and Leeds.

Greater Manchester was recently named the most lucrative new-build property hotspot in the UK. As the Northern Powerhouse becomes more powerful, attracting businesses and buyers alike, this trend appears likely to continue.

Increasingly, we are seeing an exodus of people moving away from London towards these areas. The knock-on effect of this is increased investment and regeneration in these locations, further boosting their attractiveness.

Other factors to consider

While people will generally move further afield in order to secure a new-build property, there are variations. The Savills report shows that older buyers “tend to move further overall”, including for existing properties. The figure for this age group rises much higher for new-builds, though.

“There is a step change between the ages of 50 and 60 which is likely to be a consequence of retirees moving to start a new phase of life. They may be looking to move away from an employment location, move closer to family, or possible downsize.”

Income plays a part, too. While more affluent people may move further overall to buy property, those with lower incomes move further for a new-build. According to the data, people earning £35,000 move 70% further for a new property, compared to a 24% greater distance for those earning £140,000.

New-builds are getting better

People are attracted to new-builds for a variety of reasons. This includes:

  • There’s no chain so a move can be quicker
  • You can get discounts from certain developers
  • New-build home warranties offer peace of mind
  • Everything is brand new, and you can customise fixtures, fittings and even decor
  • Cheaper and greener to run
  • Help to Buy scheme covers new-builds
  • Top choice for to attract tenants
  • Less hassle for landlords with less repairs and maintenance

 

In a recent customer satisfaction survey by Home Builders’ Federation (HBF) and the National House Building Council (NHBC), nine out of ten new-build buyers said they would invest in one in the future. This shows an improving satisfaction rate, as people rated quality, design and layout as the top aspects of their new-builds.

The survey also showed a huge increase in the number of five-star housebuilders. While in 2019 there were 21 top builders, this year there were 36. The fact that people will now move further in order to bag a new-build is testament to the increasing standards and desirability of this property type.

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Why buyers go the extra mile to invest in a new-build

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