The average premium paid to purchase a new build property compared to the price of an existing home in Britain is 29%, new research shows.
Overall, the average price of a new build property in the UK is £323,667.
The greatest difference in price between a new build and the rest of the market is in Harlow, where the discrepancy has reached 106%, equating to a price difference of £290,424.
Blaenau Gwent in Wales followed, with the gap being 99%, with a price difference of £100,088.
Gravesham is also home to a large new build price premium, coming in 99% higher than the wider market, with Gravesham (93%) and Preston (90%) also home to a 90%-plus price premium.
Emma Power, COO of Warwick Estates, which analysed the data, said: “Despite the uncertainty posed by the pandemic the UK housing market has boomed and this is no different where the new build market is concerned.
“New build homes have continued to command a price premium in every region of Britain and this is not only good news for those developers delivering them to market, but also to new build homebuyers who continue to see their investment hold its value.
“In the best performing areas, new build property prices are as much as double that of the existing market which is proof of the value being added by the sector to the wider DNA of the national property market.”
| Table shows the new build and existing average house price across each nation/region of Britain and the difference | ||||
| Location | Average New Build House Price | Average Existing House Price | New Build Premium (£) | New Build Premium (%) |
| North East | £206,963 | £135,584 | £71,379 | 53% |
| Scotland | £229,159 | £158,862 | £70,297 | 44% |
| East Midlands | £292,664 | £209,770 | £82,895 | 40% |
| West Midlands Region | £294,479 | £213,450 | £81,029 | 38% |
| North West | £250,579 | £182,270 | £68,309 | 37% |
| Wales | £239,299 | £176,594 | £62,705 | 36% |
| Yorkshire and The Humber | £232,671 | £179,642 | £53,028 | 30% |
| East of England | £389,416 | £306,335 | £83,081 | 27% |
| South West | £331,819 | £276,985 | £54,834 | 20% |
| South East | £401,362 | £340,295 | £61,067 | 18% |
| London | £508,782 | £493,617 | £15,165 | 3% |
| England | £333,823 | £265,592 | £68,232 | 26% |
| Great Britain | £323,667 | £250,271 | £73,397 | 29% |
| Data sourced from the Gov.uk UK House Price Index – New Build vs Existing (February 2021 – latest available data) | ||||
| Table shows the top 10 areas with the highest new build price premium (%) when compared to the existing market | ||||
| Location | Average New Build House Price | Average Existing House Price | New Build Premium (£) | New Build Premium (%) |
| Harlow | £565,501 | £275,077 | £290,424 | 106% |
| Blaenau Gwent | £201,289 | £101,201 | £100,088 | 99% |
| Gravesham | £559,089 | £289,889 | £269,200 | 93% |
| Preston | £263,481 | £138,488 | £124,993 | 90% |
| Torfaen | £306,459 | £162,455 | £144,004 | 89% |
| West Dunbartonshire | £216,075 | £115,735 | £100,340 | 87% |
| Rochford | £653,529 | £350,215 | £303,314 | 87% |
| Middlesbrough | £213,206 | £116,361 | £96,845 | 83% |
| Merthyr Tydfil | £210,193 | £116,704 | £93,489 | 80% |
| Nuneaton and Bedworth | £334,539 | £186,272 | £148,268 | 80% |
| Data sourced from the Gov.uk UK House Price Index – New Build vs Existing (February 2021 – latest available data) | ||||
Comments (4)
These articles should make me laugh… but they are far from funny.
Is a new home preferable to an older one? Yes – to some people. And for a number of reasons – exactly the same as why an older one is preferable to other people.
People have a choice whether they buy new or older homes – always been the same. If there was not a market for them they simply wouldn’t be built.
Is a new home more expensive than an older ‘comparable’? Yes. A rule of thumb that generally doesn’t change.
But in the vast majority they are not 80%… 90%… or more dearer than their older ‘comparables’. Statistical [Word removed as it breached posting guidelines] (credit: Jonnie) is brought into play once again to suit the agenda of the writer of this piece.
If they were – and on the basis of the adage that only fools and their money can so easily be parted – I doubt there are so many fools coming out of the woodwork every year as to make the new homes industry so successful.
No mention of how ‘help to buy’ creates that premium.
I find the ‘analysis’ a complete farce, and not just because there is no distinction between ‘premium’ and ‘investment ‘ – help to buy is effectively a state subsidy to new home developers and an effective tax on an ordinary person selling their home and competing with a new development down the road.
Throw into the mix the potent cladding scandal that has been funded by ‘Help to Buy’. Indeed, go and ask those unfortunate souls if their investment has been a good one.
This! Exactly this!
“help to buy is effectively… an effective tax on an ordinary person selling their home and competing with a new development down the road.”
Hardly. If the cost of buying new is, as suggested in the ‘article’ 29% or more than an older neighbouring home, then there is little or no reason to buy new. You’ll be paying the same – but with a future bill for the balance hanging around your neck.
And as to the “tax” you refer to – I assume that’s the positive effect that a new development generally has on its’ surroundings – usually resulting in the upward movement of prices of neighbouring properties.
I would suggest that’s a “tax” that the majority of those homeowners would actually welcome.