New-build shortage puts pressure on government’s 1.5m homes target

Despite the Labour government’s plan to build 1.5 million homes by the end of this Parliament, new-build properties currently account for just 8.1% of all homes for sale across Great Britain.

Data from UK Property Development Limited reveals that new-builds make up just 8.1% of homes currently on the market, leaving buyers with a relatively limited choice of newly built properties.

The findings come as the government announces its Your First Home scheme, aimed at helping first-time buyers get onto the property ladder.

Increase buyer demand

According to the data, London and Wales have some of the biggest new-build shortages, with new homes accounting for just 6.3% of listings in London and 3.9% in Wales.

Brighton has the smallest proportion of new-build properties, with new homes accounting for just 2.3% of all current listings. Nottingham follows at 3.2%, while Bristol records 4.1%.

Andy Morrison, director of UK Property Development, warns that the Your First Home scheme could drive further demand for new-build properties by helping first-time buyers purchase with deposits as low as 2.5%, backed by 20% government equity loans.

The scheme is aimed at prospective first-time buyers purchasing a new-build property from a developer signed up to the scheme.

He said:“Andy Burnham’s plan to bring back Help to Buy will almost certainly increase buyer demand for new-build homes. But these figures highlight just how limited the choice of new-build homes is up and down Britain.

“They account for barely 8% of the market, so buyers who specifically want a newly built property are already dealing with a small pool, and the challenge becomes even greater for those looking for a genuinely high-quality or luxury new home. Should Help to Buy come back, the problem will only intensify.

“London is a particularly striking example, with new-builds making up just 6.3% of all available listings. For buyers who want the benefits of a new property, combined with a high level of design, specification, and finish, the available choice is therefore extremely limited.”

Liverpool has the highest proportion of new-build properties

However, the picture changes significantly at city level, with Liverpool recording the highest proportion of new-build properties among the locations analysed. New-builds make up 16.5% of all available listings, followed by Glasgow at 13.2% and Edinburgh at 11.8%.

Newcastle also records a relatively high share of new-build homes at 11.3%, with Manchester at 9.9%. Leeds and Leicester follow at 7.2% and 6.8% respectively.