Whilst the average price of a new home remained relatively unchanged in August, it is predicted that demand will push prices up by between 2% and 3% over the next 12 months.
The average price for a new home in August was £234,783, this was down just 0.3% since July and 0.1% over three months.
Commenting on the data, Steven Lees, Director of SmartNewHomes, said: “New home prices were stable in August compared with a price correction in the wider market. This is a mark of the unrelenting demand for new homes from buyers, in spite of a summer dominated by the Olympic Games. Demand for new homes is likely to be further buoyed by FirstBuy, which has received £280million in additional funding, and NewBuy, which has reached 1,300 transactions, as both schemes continue to help buyers purchase a new home amid the ongoing freeze on high loan to value mortgages.
“Although the number of new homes coming onto the market dipped in August, many housebuilders will have opted to delay launching new developments and phases until the autumn and we expect to see an increase in new homes coming online in September. New planning measures announced by the Government, which include fast-tracking large residential schemes and bypassing those councils not ‘performing’ could also bring more new homes to buyers over the next year. However, it will be some time before the industry is able to make a dent in the 223,000 needed each year. For this reason we expect to see price growth of 2-3% this year.”
Richard Gordon of UKPI said: “The new homes market continues to underpin our business and property investment for our clients. New homes are more attractive to tenants, require less maintenance and are generally more economical and less expensive to run. We will continue to promote new homes over resales as we see real advantages for our investor clients.
“We continue to see good rental demand and potential for capital growth in the sector for well located properties. We have some exciting new schemes coming available in the next weeks and months and we will be announcing further details soon.”