Prices are soaring for new-build homes in Cambridgeshire

Prices are soaring for new-build homes in Cambridgeshire, according to the latest figures from the Land Registry.

Across the county, the average cost of a new-build was £418,765 in April this year – up by 12% from £374,857 in the same month of 2020.

It puts new-build homes at around 37% more than existing properties in Cambs – the biggest gap on record.

Read more: Property news across Cambridgeshire

In comparison, existing properties in the area came in at £305,737 on average, up 7% from £286,946 last year.

There has long been a premium on new-builds, with these homes usually costing significantly more than existing properties in the same area.

Part of this is because housebuilders have always struggled to keep pace with the demand for newly constructed homes – and this has only been exacerbated during the pandemic .

Several factors, including the stamp duty holiday, the lifting of lockdown restrictions, increased mortgage availability and low interest rates, have all contributed to a boom in the property market in 2021.

In what online real estate company Zoopla have dubbed the “race for a space”, in March this year buyer demand was running more than 80% higher than the same period in the previous four years, with the supply of homes for sale failing to keep pace with this demand – leaving swathes of buyers scrabbling over a limited number of properties.

At the same time, Covid has wreaked havoc with building sites and new developments, with national lockdowns and strict social distancing guidelines leading to a significant drop in the supply of new-build properties over the last year.

National House-Building Council figures show that between April and June 2020, the number of private new homes registered across the UK fell to around a third of the number seen in the same period of 2019.

While home building has since recovered to pre-pandemic levels, the overall number of private new homes registered between April 2020 and March 2021 was down by 24% on the year before.

Combined with the “race for a space”, this has seen the cost of new-builds shoot up faster than existing homes.

Of course, the new-build premium varies depending on where in Cambridgeshire you’re looking to buy.

Where are the biggest differences between new-build and existing homes?

Cambridge has the largest price gap between new-builds and existing properties, with the average new-build selling for £637,420 in April – 44% more than the average sale price of £441,367 for an existing home.

Meanwhile, Huntingdonshire has the smallest gap, where the average new-build sold for £285,488 – 2% more than an existing property at £280,155.

First time buyers in particular are likely to be impacted by the rapidly rising cost of new-builds.

In some cases the only way to get onto the property ladder is to opt for a new-build, with schemes such as Help-to-Buy and Shared Ownership only available on the purchase of a newly constructed home.

New-builds come with many benefits, not least having all the latest fixtures and fittings, higher environmental standards and lower bills, and no chain.

However, the rising cost of new-builds won’t necessarily translate to a faster growth in value when it comes to reselling.

Many of the benefits of buying a new-build disappear on the day you buy it and it is no longer brand new, meaning a one-year-old property may fall in value as buyers look at new-builds elsewhere.

If you are buying a new-build, it makes sense to live in it for the longer term.

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