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.
Your First Home: confidence to build
Sponsored by Halifax 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.
Read more coverage from this year’s British New Homes Mortgage Senate:
- British New Homes Mortgage Senate: Lenders assess what’s holding back homeownership
- British New Homes Mortgage Senate: Uncertainty around Future Homes Standard costs and valuations
- British New Homes Mortgage Senate: Brokers and developers should take longer-term view of buyer journeys
- British New Homes Mortgage Senate: The economics of housebuilding have changed since Help to Buy
