20 things

SmartNewHomes.com New Homes Index and Migration Monitor

28 July 2007

1 SmartNewHomes.com’s New Homes Index has reported the average new home price fell by 0.3 per cent in June 2007 to 260,073, from a record £260,832 in May 2007.

2 The decline was attributed to buyers being deterred by the impact of May’s rate rise and severe weather conditions leading to the wettest June on record.

3 SmartNewHomes.com said a strong price rise in July was unlikely, as many new home buyers are deterred by the continuing bad weather and are delaying their search until conditions improve.

4 The demand for family homes remains high and new townhouses and semi-detached homes have recorded the biggest price increases.

5 Semi-detached homes increased by 2 per cent to £246,554, while townhouse prices rose by 0.6 per cent to £245,488.

6 Despite experiencing the biggest fall in price last month, the penthouse remains the most expensive new home, with average prices in excess of half a million pounds.

7 The number of townhouses and detached homes both increased by 1 per cent. SmartNewHomes.com said this was an indication that steps are being taken to address the family home deficit, but it is still not enough to address the imbalance.

8While the average price of a new home has fallen marginally over the last month, the average price buyers are willing to pay has fallen sharply.

9 This was the result of the impact of earlier rate rises filtering through to the market and consumers’ continued fear of further increases to come before the end of the Summer making them cautious.

10However, the temporary slowdown of the market is not unusual for this time of year and the average price of a new home has shown positive growth over the last quarter, with prices still up on those at the same time in 2006.

11 Over the past three months, the average new home has risen 1.7 per cent in value and, for the second month, new home prices have experienced positive price growth over the last quarter.

12 The average price of a new home has increased 0.6 per cent on June 2006’s price of £258,581.

13 The index showed prices in London have fallen 11 per cent on June 2006, yet it remains the most expensive place to buy a new home in the UK.

14 An increasing number of commuters are now looking to areas outside of the city, such East Anglia, which now out performs the UK average with price growth of 14.6 per cent over the last year alone.

15 The North continues to be popular with new home buyers, offering some of the lowest house prices in the country.

16 London and the South East are the least popular destinations for new home buyers.

17 For the first time in nearly three years, the South West has experienced outward migration, as rising house prices make it the fourth most expensive region to buy a new home in UK.

18 David Bexon, managing director of SmartNewHome.com, said: “With rates seemingly on the up and the severe weather conditions extending well into July, I fear we should prepare for a further fall in price over the coming months.”

19 He added that the Department for Environment Food and Rural Affairs estimates the number of homes affected currently exceeds 20,000.

20 Bexon said: “With fears of another rate rise, a growing number of home owners are feeling cautious about taking additional debt at such an uncertain time. Many first-timers are waiting for more appealing fixed rates before committing to their first mortgage.”

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