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Cheaper new homes provides investment prospects

8th November 2005 | back to article listings BACK    print this article PRINT

New research has revealed that newly-built properties are now cheaper than at any time in the past 12 months, offering a major incentive to those considering buying a second home.

According to figures released by SmartNewhomes.com, new properties now average a selling price of £255,327 each, which represents a 2.4 per cent fall on October 2004. That price is also 0.2 per cent cheaper than in September, the firm has stated.

The announcement means that many people who are considering investing in property in the UK will now be able to afford newer buildings, which will require less work to make them habitable as second homes or as part of property portfolios to be rented out.

Snapping up new builds will provide many investors with the chance to increase their portfolios relatively cheaply, especially as some experts believe that the recent decline in prices is likely to generate a jump in interest in new properties among first time buyers. Such a move could see prices start to rise once again, so many investors might be better advised tom make their move sooner rather than later.

Many experts believe that the property market in the UK has now bottomed out and is unlikely to drop very much, if at all, in the months to come. Indeed, estate agent Savills is expected to declare that overall average property prices will stagnate in 2006, showing only small signs of growth. According to In2Perspective, the agent will announce its prediction later this week, but the slow market may provide a greater opportunity for investors.

Referring to the slowing market, David Bexon, managing director of SmartNewHomes commented: "This situation is unlikely to change much as we approach the festive season but once the new year is upon us, it is quite likely that buyers and sellers will have been reassured by the market’s stability and we could see prices begin to edge once again."

Therefore, investors might be wise to make their move now and during the festive season so as to get the best value for their money on new properties, because waiting until after Christmas could be too late.

If properties do begin to be snapped up in the New Year, those who dither and dally in the next two months could find themselves having missed a major opportunity to find a bargain.

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