Residential property market analysts Hometrack’s latest analysis has shown that out of the entire UK, it is the North East of England that has the greatest concentration of new build properties.
The term ‘new build’ is defined as the number of private housing starts within the last year, and 14% of total housing transactions in the North East over the last 12 months are classified as new build. In contrast, the figures in London are 13.9%, while the East Midlands figure is 12.1%.
Around 11% of all property transactions across the UK are new build, but – as shown by Hometrack’s study – the distribution of development isn’t uniform across the UK.
Recently, the emergence of build-to-rent, the introduction of Help to Buy, and growth in LCHO has made some local housing markets more new build driven than others.
At present, the North East is proving to be a good return on investment for house-builders. In what could be a factor to explain the level of new build supply over the last year, the region has outperformed its long run average.
A 2.4% increase on the 5-year CAGR of 1.9% has been registered, mainly because the market is less mature in its recovery following the financial crisis than other areas, while there is still headroom for growth.
Alex Rose, Director – Residential Real Estate Solutions at Hometrack said, “The above average level of new build concentration in the North East could indicate that developers are sensing demand for new housing.”