Is buying a new build a good investment?

As a new build home developer in the UK, we like to think that here at Linell Homes we know a thing or two about new build houses. Questions we’re frequently asked are ‘is buying new a good investment?’ And ‘what are the benefits to a new build home?’ Well these questions really go hand-in-hand and we’d like to give our opinion on why buying a new build property in the UK is a great investment in your future.

New Build Premium

A lot of people look at new builds and identify that there may be a premium price over and above the market for older properties. Well, research from CompareMyMove [https://www.comparemymove.com/advice/new-build-homes/new-build-vs-old-build] suggests that this can be the case. However, it’s important to identify the reasons for the premium being paid – and we’ll take a look at that in more detail below.

NHBC Warranty

One of the key reasons people buy new build houses, and one of the reasons they are often more expensive is that they come with a 10 year NHBC warranty. This means that any structural issues that arise within the first 10 years of ownership must be addressed, free of charge, by the builder or their contractors. For many buyers this gives them the additional peace of mind that they’re unlikely to spend much, if anything, on maintenance for at least the first 10 years of the property’s life.

When you compare this to existing housing stock (i.e. older properties) where there are no such warranties, you can see why people may prefer the ease of choosing a new build home.

Energy Efficiency

Another major benefit of new builds are their energy efficiency. Building standards and regulations on energy efficiency have improved substantially in the last few years and all new build homes must have cavity wall insulation, as well as energy efficient boilers. New homes are even draft tested, which means less time and money heating the home. It’s calculated that new build properties save over £600/year on energy bills according to the HBF [https://www.hbf.co.uk/news/new-build-homes-save-owners-629-a-year-on-energy-bills/]. This means a significant saving over the time the home is occupied by the new owners.

Newy Newness

One of the great things about a new build home is your ability to choose the fixtures and fittings (this can sometimes depend on what build stage the property is at). That means you can get things exactly how you want them prior to move in. That also means less to spend once you have moved on making updates, naturally the same can’t be said for an older property – where most buyers have to spend years, and lots of money too, finally getting each room the way they want it.

New Builds for Investment

New builds also make a great investment property. House prices in the UK have been rising, in some areas dramatically, in the time since the COVID pandemic. This has been due to pent up demand and historically low interest rates. As interest rates begin to rise property remains a fantastic investment opportunity – whether you’re a cash buyer or require a mortgage paying towards your property – you’ll see your equity rise as house prices increase. Whether you’re buying to add to a rental portfolio, buying for yourself or as a family home – rising prices and high demand for new build housing will be a great investment for you.

When and if it comes to the time to sell your new build home you’ll also find that demand for new and nearly new build properties is very high, for all the reasons we’ve mentioned above. This then commands a higher price on the market.

Final Thoughts

So, yes, we’re Linell Homes, and yes, we’re a new build property developer in the UK working primarily in the North of England – but we really do believe that new build homes are a great investment.

 Think about everything you want in a home…

  • Would you like to make choices on the fixtures and fittings of your home?
  • Would you like the security of knowing your home is covered by NHBC warranty?
  • Would you like an energy efficient and environmentally friendly home?
  • Would you like a place for your family to grow without the worry of having to make upgrades to your home?
  • Would you like to be the first people to live in your home?
  • Would you like to have no-stress and no-chain when making a move?

Then a new build home is definitely the investment for you!