Buyer demand in the new build market remains high, reflected by the latest figures, which show that new homes reservations were up 7% in the first quarter of this year compared with the same period in 2021, and 41% up on pre-pandemic reservations in Q1 2019.
New research from Savills suggests that limited choice across the housing market, especially for larger second-hand properties, has prompted many buyers to consider new build for the first time. However, the combination of limited construction materials and slow planning decisions means supply of new homes is declining.
Savills finds completions have been declining for the past three consecutive quarters, with only 238,500 new homes being built in the year to Q1 2022 – a 7% drop on the peak of 255,000 at the same time in 2020.
George Cardale, head of residential development sales at Savills, commented: “Bricks, cement and roofing products have all become increasingly difficult for housebuilders to source, as well as being more expensive to produce, due to the rising cost of energy. Not only is it increasingly costly for developers to build, but a fall in the number of consents granted since the peak of 2019 is creating intense competition for sites to build on.”