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New builds far more expensive for landlords than existing homes

Existing homes have risen some eight per cent in value in the past year while the price of a typical new build is now 28 per cent more than 12 months ago.

The current average price of an existing home in Britain is £272,851; by contrast the average price of a new-build has risen from £330,662 to £422,414 - up by well over a quarter.

The gap is even greater in some regions. 

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Landlords buying an average new-build home in Wales will now pay 34 per cent more than a year ago, while existing homes have seen capital appreciation of 11 per cent.

In Scotland, new-build inflation has been 29 per cent - existing homes are only seven per cent more expensive to buy now than 12 months ago.

However a spokesman for Unlatch - the organisation behind the research and an advocate of new homes - says: “Investors on the whole do prefer to go for a new build property for many reasons, one more being that by the time said investor completes on their purchase, the agent usually already has a tenant lined up to move in; meaning no void periods. 

“In a fast, frantic, and highly competitive housing market, new-builds also offer more reliability in terms of the actual purchase itself. Fewer sales are subject to falling through as a result of unwanted discoveries during the surveying process, as well as the fact there is no dreaded chain to contend with.”

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Poll: Which is likely to be the better investment for landlords?

PLACE YOUR VOTE BELOW

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    New builds like new cars are a mugs game, try selling a new build a year after buying it and you will loose thousands.

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    They are presented well initially, but once that interior decoration boost has gone, the small room sizes in many new builds become even more apparent.

     
  • icon

    I quite like modern houses but tend to buy them as the second owner. Several of mine have been the same price as they were brand new several years earlier and 2 were much cheaper (£15K and £30K). The other big advantage of buying slightly second hand is that the development is finished by that stage. The school has been built, the bus service exists, etc.

  • George Dawes

    They’re also built to far lower standards of construction

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    And let us not forget, they are also subject to “ Estate Rent “, that open ended, uncapped charge which the rest of us in “ True “ Freehold houses don’t have to pay. I think I will pass.

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