UK Home Buyers Lose Interest in New Builds?

Recent data has revealed a trend in the UK property market: a consistent decline in interest towards new build properties over the past three years. This insight, gathered from UK conveyancing solicitors Bird & Co, highlights shifting preferences in the real estate sector, especially among home buyers in 2023.

The data, a detailed analysis of internal property enquiries by Bird & Co, presents a clear pattern:

2021: Interest in new builds was recorded at 14.35%.
2022: A slight dip to 13.68%.
2023: The interest further decreased to just 11.18%.

This steady decline culminates in a significant observation for 2023, where only about 1 in 10 Bird & Co clients expressed interest in new build properties.

Peak Interest and Overall Trends

December 2023 saw a peak in interest, with 13.31% of enquiries about new builds. However, the year’s average hovered around 11%, indicating a broader trend of diminishing appeal.

Despite government efforts to encourage new property construction, as reflected in the Office for National Statistics (ONS) data, the anticipated interest in these new builds hasn’t materialised as expected.

First-Time Buyers and Market Stagnation

A crucial factor that might explain this trend is the stagnation in the number of first-time buyers in 2023. The data shows that 68% of enquirers did not previously own a property, a figure unchanged since post-Covid times. New builds, typically attractive to first-time buyers due to exclusive home-buying schemes, seem less appealing, possibly due to affordability challenges.

2023 witnessed a peak in the cost of new homes, coupled with historically high mortgage rates. This financial landscape could be deterring potential buyers, particularly those looking to purchase their first home.

Daniel Chard, a Partner at Bird & Co, emphasises the crux of the issue:

“Constructing new homes loses its purpose if they remain unaffordable, especially for aspiring first-time buyers. The goal of promoting new developments should center on accessibility. If not, government efforts become a mere construction exercise rather than a step towards inclusive, sustainable communities. Our statistics show that current schemes have only minor impacts on first-time buyers. Meanwhile, second-time buyers are dominating the market, resulting in more rental homes and business opportunities.”