Property

New-builds see prices up 272% since the start of the Millennium

Property Reporter
|
4th August 2021
New Build 900

With the average homeowner occupying their property for an average of 21 years, new research highlights how the new-build market has outperformed the rest both where price growth and price premiums are concerned since the turn of the millennium.

Warwick Estates analysed new-build and existing house prices between 2000 and 2021 and found that across England and Wales, the average new-build has increased in value considerably.

In 2000, the average new-build cost £92,234, but today, this has increased to £343,185 - a 272% increase. While the existing market has also seen impressive growth, the average house price has increased by just 254% in comparison.

The premium attached to new-build homes has also jumped by some margin. In 2000, the average new-build home cost £17,805 more than the average existing property. Today, this premium has climbed to £79,426.

London has seen the biggest jump in new-build values, up from an average of £133,568 in 2000, to £525,927 - a 294% increase and 19% more than the existing market where prices are up 275%.

The East Midlands (290%) and the East of England (290%) have also seen some of the largest increases and have also outperformed the existing market to the largest extent, with a 27% and 26% respective difference in price growth during this time.

However, all areas of England and Wales have seen new-build house price growth not only exceed 200% since the start of the new Millennium but also outpace the existing market.

The East of England has also seen the largest increase in new-build premiums. In 2000, new-builds were valued £19,345 higher than existing homes, but today this has climbed to £97,435 - a £78,090 increase.

The East Midlands (£73,222), the West Midlands (£66,255) and the South West (£60,998) have also seen the premium attached to new-build homes climb by more than £60,000 in the last two decades.

Bethan Griffiths, COO of Warwick Estates, commented: “New-build homes have always commanded a premium and this premium has climbed considerably in the last two decades as house prices have risen, but also the quality and offering of the new-build sector has evolved.

"While getting a foot on the new-build ladder may present a tougher task for aspirational homeowners initially, they are far more likely to see their investment not only hold its value but increase at a greater rate than the existing market. So it can be well worth the additional initial financial investment for those with a long-term view of homeownership.”

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