Put simply, the UK is currently in a housing crisis. When put into context, the National Housing Federation predicts that 340,000 new homes will need to be built every year to keep up with the growing number of people needing suitable housing.
The current Government has pledged to build one million new homes by 2025, although we are already falling short of this target. The reality is that as a nation we are falling short and will continue to fall short for suitable housing across the country unless action is taken.
The obvious solution here would be to increase the production of new build property. However, the number of homes in the market is not the biggest problem here. Of course, there is an undersupply of property on the market, but the demand for new build properties is the crux of the problem.
With potential buyers stating that new build properties are too expensive, lack character, and are generally built to a worse standard than expected, the general lack of demand for these builds is having a bigger impact in the market than anything else.
Whilst increasing the production of new build properties in years to come should be a priority, the Government needs to work on making new builds more attractive to first-time buyers. Working harder to tackle the negative perceptions towards new build properties should also be a priority for the current Government, giving buyers a better, real choice in the property market.
Looking deeper into the issue
Here at FJP investment, we were well aware of the problems in the market. To reinforce these thoughts, we chose to carry out a survey asking over 1,000 UK-based homeowners what their thoughts were towards new build properties.
Being aware of the negative perceptions, it was a surprise to see that over three quarters (78%) of homebuyers viewed or considered a new build property when buying their last property.
Clearly buyers are still willing to view new build property, but the concerns upon seeing the property were all too clear. Roughly half simply thought the property was unattractive, with even more (63%) saying the property was completely devoid of character. Three in five also stated that the finish of the properties was to a low standard.
Change must be made in the sector
The Government must make more of a concerted effort to improve the quality of new build properties – particularly when it comes to the aesthetic of the properties.
There are some signs that we may see this over the coming years. Boris Johnson, soon after he was elected, stated the need to build “beautiful homes that people actually want to live in”.
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To achieve this, the Government will need to work closely with developers and local councils to achieve this. On a practical level, financial support for developers will go a long way, but also support for protections for homebuyers. As an example, the NHBC Buildmark is an insurance scheme that will serve to assure homebuyers that any problems liable on the developer they may face after the purchase of the property will be remedied.
Working with local authorities will also realize the potential of each stage of the construction process to meet general building regulation standards, preventing structural defects further down the line.
What buyers can do to minimize risk
Although most would agree that the risks associated with the purchase of new build property is lower than that of existing housing, there are still things that buyers can do to allow greater ease of mind when purchasing new builds.
As previously mentioned, when buying property, look out for a Buildmark scheme. You would expect a new build to fault free but insuring the property will cover you in case of defects down the line.
Most, including the NHBC trademark, covers the buyer for two years after legal completion of the property, this is usually enough time to work out if there are any additional faults. This will then be remedied within this period with the costs fully covered. You can see how a scheme like this included in the sale of new builds would increase buyer confidence.
Of course, you should always use a certified charted surveyor when purchasing a home, regardless of its age. This will highlight any issues with the builder from the offset to prevent these issues from surfacing years in the future.
Getting to know the developer that built the property is a good idea also. Looking at past sites and general sentiments towards the developer will give you a greater idea of what you can expect the standard of the property to be.
Doing some online research is a great start to get to know the developer, make sure not to be dependent on the developers’ marketing material, and source out impartial reviews. This should give you as a potential buyer a greater idea of the potential flaws, or hopeful assurance that come with the development.
Look for completed sites the developer has previously helped construct and even see previous developments where possible in person. You could take the opportunity to get the opinions of those that are already living in the developer’s construction.
The heart of the problem
Ultimately, the design of the property needs to improve to add character, making them more appealing to buyers. Ensuring that the build quality is to a high standard and the fittings are correctly installed and appropriate will go a long way to not only improving the popularity of new build properties but also aiding the housing crisis faced in the UK.
Put bluntly, it is a waste of time investing in new builds that continue to occur the same problems with no one willing to buy them. Hopefully, we will begin to see the quality of new build properties improve with time. With the Spring Budget fast approaching, the Government need to pledge to improve the standard of new homes. With this, we hope to see more beautifully designed, practical new builds enter the market.