According to a survey by Knight Frank, nearly two-thirds of UK housebuilders are now offering non-cash incentives to attract buyers. This shift in strategy highlights the creative approaches being adopted in response to the difficult market conditions. About 59% of the respondents reported offering items like carpets or white goods to sweeten the deal for potential buyers. Additionally, more than 40% are contributing to legal fees or stamp duty, and nearly a quarter are providing deposit contributions. This trend indicates a move away from traditional selling techniques, focusing instead on value-added incentives to make property purchases more appealing.

Overcoming Financial Hurdles: Cashbacks and Mortgage Subsidies

In an effort to make properties more accessible, 16% of the housebuilders surveyed are offering cashbacks or mortgage subsidies. These financial aids can significantly lower the initial cost barrier for buyers, making property investment a more attainable goal for many. This approach is particularly important in the current economic climate, where mortgage availability and cost have become major concerns.

The Challenges: Planning, Land Availability, and Economic Outlook

The survey revealed the biggest hurdles facing the UK housing sector. A staggering 80% of respondents cited planning delays as a significant challenge. This issue, coupled with concerns about land availability and the cost and availability of mortgages (both at 47%), paints a picture of a sector under strain. Additionally, 36% of the respondents are worried about buyer sentiment and the overall outlook of the UK economy, indicating broader concerns that go beyond the immediate real estate market.

Industry Perspectives: Adapting to Market Evolution

Charlie Hart, a partner at Knight Frank, emphasized the importance of the industry’s adaptability and agility in response to these evolving market conditions. He noted that housebuilders are intensifying their efforts to generate sales, underscoring the need for government support and positive policy direction, especially in the upcoming autumn statement.

Anna Ward, an associate in Knight Frank’s residential research team, highlighted that mortgage costs and buyer sentiment have become increasingly prominent concerns over the past year. She also pointed out that the direction of the UK economy is likely to be the most influential factor affecting the housebuilding sector in the coming months.