New build sales: The big picture

By: LSL Land & New Homes


When considering changes in the property market it is very easy to lose sight of the bigger picture. We have analysed residential new build property sales from 2005 to 2017 to reveal some of these hidden trends.

The proportion of new build sales when compared to all other sales including commercial has remained remarkably stable with an average between 2005 and 2017 of around 10%.

Proportion of new build sales versus all other sales inc commercial 1999 to 2017

The same trend holds true when the number of new build sales is compared against all other property sales. So during times of volatility in the greater property market, the new build sector seems to be extremely robust.

In the property market overall, despite substantial recovery, transaction volumes were still less in 2017 than was the case between 1999 to 2006.

Number of new build sales versus all other sales inc commercial 1999 to 2017

The value of the transactions within the market and by property type has increased substantially since 1999 reflecting house price increases over time. Hence, there is more value in the market today despite fewer transactions. The reduced share in 2005 may have been down the effect of the 7/7 London bombings.

Property prices for detached properties in effect plateaued between 2007 and 2012 after a prolonged period of steady growth. Between 2013 and 2017 there was a steady but slightly slower rate of price growth.

Average purchase prices for detached properties 1999 to 2017

The proportionate volumes graph below shows a recent transfer of activities from London to the regions. However, London has seen considerable volatilities over the years and when activity in London reduces the other regions seem to benefit relatively evenly. The overall trend is that London has seen consistent increases in market share since at least 2007. There also seems to be a cyclical aspect to London’s role, with the region currently in the midst of the downturn part of the cycle. Recently however, there have been signs that London does now show signs of bouncing back, with Hometrack for example reporting average price increases.

Proportionate transaction volumes by year 1999 to 2017

Overall, the South East has outperformed every other region for almost the entire period. Since 2011 the East of England has seen a consistent loss of share.

As specialists in land and new homes LSL Land & New Homes can help you throughout the development cycle from buying development land through to new build sales & marketing.

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