Hosted by Mortgage Solutions at 30 Euston Square, one panel at the British New Homes Mortgage Senate discussed how the new-build sector communicates value to buyers.
New-builds ultimately priced by market
Speaking on the matter of how new-builds are valued, Ed McCoy (pictured, far right), group sales director of Persimmon Homes, said the market ultimately determines what new-build homes sell for, regardless of increases in build costs or changes to government standards.
He said it was irrelevant whether measures such as the Future Homes Standard “adds £7,000 or £15,000” to the cost of building a home because the property will ultimately be valued by a surveyor and sold at a market-determined price.
“It is an issue for the developer,” McCoy said, adding that it is “not really an issue for the consumer” since the market decides the value.
Episode 4: New Build: Powered by Partnership podcast from Newcastle for Intermediaries
Sponsored by Newcastle for Intermediaries
McCoy also said developers are “desperate for sales” because of the challenges facing the housing market.
Addressing the new-build premium
Morne Jacobs (pictured, middle right), director of strategic partnerships at The Mortgage Store, said new-build premiums were “real”, but buyers received benefits in return.
“There’s definitely a benefit and that’s why you pay a premium for it,” he said, adding that it is important to present those benefits to customers and ensure they understand what they are paying for.
Asked whether brokers are doing enough to discuss new-build homes with customers, McCoy said: “We could always do more.”
McCoy added that the financial benefits associated with new-build homes should not be viewed as a marketing message, arguing that buyers should expect homes to be built to the latest regulations and standards, including carbon efficiency requirements.
Felicity Barnett (pictured, middle left), new build and affordable housing partnerships manager at the Mortgage Advice Bureau (MAB), agreed, but emphasised that advisers face significant pressure because of the wide range of financing options they need to advise on.
She clarified that customers should understand the benefits of new-build homes at some stage of the advice process, even if those discussions do not take place during the first phone call.
Barnett said advisers need to prioritise information in a way that encourages customers to engage, but added that she did not want to “prescribe” exactly what that should look like.
