To wonder why new builds are so overpriced?

[chickenlittle2020]

Been browsing properties as wife and I are hoping to get on the property ladder within the next few months. We've looked at new builds using help to buy and the government equity loan. They just seem so overpriced! For example, this property - no proper garden, not much space, little character on for £629K. Its so overpriced for similar older houses on the market.

www.barratthomes.co.uk/new-homes/united-kingdom/h749401-new-mill-quarter/plot-447/

Anyone shed some light on this madness???

New builds are expensive because they can be. We have a housing shortage and people pay extortionate prices for poorly constructed new build houses that are badly designed on crowded estates with limited parking, tiny gardens and poor design, so why would the developers charge less? It's their market. Only way to change it is to stop buying new builds...but since we have a national housing shortage, that's not terribly likely.

@IfIHadAHeart

Do salaries in London really offset the bonkers property prices? It’s something I’ve always wondered...

Not unless you both work (not SAHM) and/or are in a very highly paid job. We had to leave to get on the housing ladder and the rent was expensive. You can manage, but only if you’re willing to wait a long time and keep looking and find the only lower priced house in the area. Often these houses have a history though, my friend bought her first property and it used to be a brothel. There were a few awkward door knocks early on with confused men not understanding why they weren’t being ushered in.

I find it strange too. Where I live, you can buy a solidly built four bed semi with a big garden for the same price as a smaller three bed new build with virtually no garden.

The new builds come with all bedrooms ensuite and tend to have kitchen diners, so maybe that's what people want to pay for? Perhaps the idea of less maintenance is also appealing, although I've heard some terrible stories about the build quality of a lot of these houses.

I don’t get it either. That house you linked to has such an awkward layout as well, it seems really impractical to live in - no bathroom on the floor with the living room ie where you spend the most time!

I bought my house (2 bed Victorian mid terrace with front and back gardens on a side street) for just under £250k last year. 10 minutes away there is a new build development of flats overlooking the dual carriageway on one side, a road bridge the other side and the prices start at £250k for a 1 bed! Unsurprisingly they are having to throw in all kinds of incentives now as they’re struggling to sell them at full price. Last time I walked past I think it was 1st year mortgage paid for NHS staff 🙄

They're probably still paying off that helicopter from the 70s

I was always under the impression that it was because the builder had to buy the land to begin with - I know we all own the land our houses are built on but they have 2 costs to recoup, land and building expenses. In the 'good old days' you were willing to pay over the odds because you had a bright shining new house with no issues - nowadays I wouldn't buy a new build for a tenner (well, you know what I mean!)

Loads of new builds near me. Very very expensive. Apparently no wiggle room on price. The sales team were incredulous that I asked! Show homes lovely (of course!) but the standard build is almost just a shell. I worked out how much the 'extras' would be, it was almost £20k more. This was just fairly standard stuff, not granite worktops or upgrade on appliances. And not even touching the garden.

When we bought our first house we looked at new builds but opted for a 'second hand' house that was about ten years old. That was the right choice as we got a detached rather than a semi for a similar price, and it included all the fixtures and fittings, it had been extended and a lot of upgrading had been done to the house so it was a much better option for us as we were chain free and could get the mortgage.

When we upsized we bought a new build. It was a bit more expensive than similar previously owned properties, but we could part exchange our old house so it made the whole thing a lot easier, especially as I was pregnant at the time and didn't need any extra stress. The downside was that we had to shell out a lot at the start for fixtures and fittings (you don't get curtain rails, any fancy light fittings etc with most new builds) and to get the garden how we wanted it, etc. But we did get a lot of incentives like solicitors fees and stamp duty paid for us so it balanced out. Our house has only increased in value since we bought it.

So it really depends on your circumstances. If you have no chain and the money to spend then buy what suits you best. If you need help from government schemes then you don't have as much choice

Because developers and builders by their very existence need to make a profit margin on their new build 🙄....they can’t make it in years that follow. Also a headline price tag is often very different to the exchange / sale price and is presented in the sales particulars and literature to satisfy shareholders and investors.

It’s not the quality of the build, its the price of the land in the first place and perceived scarcity of housing generally, that keeps the prices high

Mine was much cheaper and included new kitchen, washing machine dishwasher and a garage. Much better value

@Iminaglasscaseofemotion

Bloody hell. I thought the newbuilds here were expensive. You could get a 4 bed detached with garage for about 250k where I live.

Ditto, I've just bought a 5 bed detached with garage for £300.

OP ... I'd also be wary about the bad press that new builds are getting at the moment.

We got a £25k discount on ours and bought one where sale had fallen through so it already had carpet, tiles etc.

I prefer new build having owned an old tenement in the past.

You get 10 years NHBC so you are covered for issues with roof (check this is sorted, sometimes it gets messed up), balconies, windows, walls.

You can also do part exchange and other moving support which removes the headache.

My old flat cost a bomb in roofing issues, dry rot, broken down pipes etc.

I would also say that seems crazy money! We have a 5 bed townhouse with great big rooms and a big shared secure green for £295k in a major city.

Personally I’ve loved having a new build. Nothing has broken, it was all shiny and new, we chose our kitchen, were the first to use the bathrooms, it was a blank canvas for decorating, it’s so warm and efficient! Neighbours all moved in at the same time so we’ve made some lovely friends.

We are moving home after 5 years but buying this house was the best thing we’ve ever done. We used the help to buy equity loan and still sold it for 40k more than we bought it for. It got us onto the market and means we’re buying a massive 4 bed detached house before we turn 30. The house we are buying isn’t a new build purely because of location- we went for the extra room this time around but I’m sure I will miss my newbuild and be a bit cold in the new place!

@Caplin

We got a £25k discount on ours and bought one where sale had fallen through so it already had carpet, tiles etc.

I prefer new build having owned an old tenement in the past.

You get 10 years NHBC so you are covered for issues with roof (check this is sorted, sometimes it gets messed up), balconies, windows, walls.

You can also do part exchange and other moving support which removes the headache.

My old flat cost a bomb in roofing issues, dry rot, broken down pipes etc.

NHBC is not worth the paper it’s written on..

We negotiated down on the price of ours. We have parking for two cars, plus a garage and quite a large garden. There’s a lake, trim trail, play parks plenty of walks.

The bedrooms are a good size and have space for wardrobes, drawers, dressing table etc and we have a super king size bed.

The issues with parking that I have seen in the area are usually around the Victorian terraced houses, with no off street parking.

Choose the developer carefully.

??????

A search on sold-prices in that post code suggests the newbuilds' prices are in line with them.

www.rightmove.co.uk/house-prices/sm6-7dy.html

@HowDifficultWouldThisBe

New properties, particularly flats, are like new cars. Cost a bit too much when they are new and shiney and depreciate quickly into normal house price within a couple of years.

The other thing I don’t like about new builds is that you don’t get to see what kind of neighbourhood you are moving into until most houses are sold.

This, absolutely.

In a previous life I was an estate agent for a few years. One office I worked at was opposite a new-build development. I used to go and value their houses and have to tell them that they were worth less than they paid for them a couple of years earlier, despite house prices generally having risen in that time.

They really struggled to get their heads round that. That was a Barratt development too, funnily enough.

I'd never buy one.

The reason I wouldn't consider any of the new build estates near me isn't the houses - they're not massively to my taste, but nor is my 60s house, really - it's that they have no amenities. They put a row of shops in a couple of them and they're just a sad little collection of charity shops, takeaway pizza places and maybe one co-op or similar. I'd hate to have to drive to do anything, but lots of people must not feel the same.

@2bazookas

The ones in the link are all new builds. The prices for those are not in line with the rest of the area.

A 3bed in that area is more like £450k

Here's a very attractive newbuild:

www.rightmove.co.uk/property-for-sale/property-64136991.html

The added features that they might have mentioned is that the area was under 10' of water in 2000, and the flood defences built upstream since then have increased the flood risk in that area, and that it's very convenient if you want to get wasted as there are at least 3 drug dealers living very close by.

Local people have been gobsmacked by the amount of building that has been allowed on the flood plain.

@Hardbackwriter

The reason I wouldn't consider any of the new build estates near me isn't the houses - they're not massively to my taste, but nor is my 60s house, really - it's that they have no amenities. They put a row of shops in a couple of them and they're just a sad little collection of charity shops, takeaway pizza places and maybe one co-op or similar. I'd hate to have to drive to do anything, but lots of people must not feel the same.

An estate near us is like this. Built a few years ago and only has one bus stop with crap service. It's a good 45 minutes walk into town and everyone has to drive their kids to school, so obviously it's going to be full of people relying on their cars. But the worst bit is, there's not enough parking. They've built family homes in an area where you'd need two cars yet only given them one parking space each. When I visit my friend on the estate, it's a bloody nightmare weaving through the roads with cars on each side and trying to find a spot to park on the road. Even though the houses are nice the place looks a mess.

@LakieLady

Here's a very attractive newbuild:

www.rightmove.co.uk/property-for-sale/property-64136991.html

The added features that they might have mentioned is that the area was under 10' of water in 2000, and the flood defences built upstream since then have increased the flood risk in that area, and that it's very convenient if you want to get wasted as there are at least 3 drug dealers living very close by.

Local people have been gobsmacked by the amount of building that has been allowed on the flood plain.

I'm not going to lie, I do actually quite like that house. That said, even the photos on the listing have the look of a flood plain about them. The fetid looking creek surrounded by lush silt loving vegetation shout "stock up on sandbags and calor gas" to me.

@Hardbackwriter

The reason I wouldn't consider any of the new build estates near me isn't the houses - they're not massively to my taste, but nor is my 60s house, really - it's that they have no amenities. They put a row of shops in a couple of them and they're just a sad little collection of charity shops, takeaway pizza places and maybe one co-op or similar. I'd hate to have to drive to do anything, but lots of people must not feel the same.

Yes, this too. I’m not so fussed about proximity to shops but I don’t drive so it was really important to me to be near bus routes etc. There is a new build estate on the outskirts of my town that I immediately wrote off because there were absolutely no public transport links to the rest of the town. Pre-COVID I commuted into London by train so if I’d bought on that estate I’d have had to learn to drive, buy a car and pay for parking at the station on top of the cost of the house. We are close to the town centre now and lots of amenities but DP doesn’t like being in such a built up area so we will be looking for a village with a local train station/regular bus service for our next move