New-build transactions down by 92 per cent due to EWS1 delays, says developer

New-build transactions down by 92 per cent due to EWS1 delays, says developer

 

According to property developer StripeHomes’ analysis of Land Registry sold price data, transaction levels for new-builds fell by 92 per cent to 2,605 in the first half of 2021. The developer said this was down to the “problematic” EWS1 process.

The largest decreases were recorded in the North East, where transactions declined by 96 per cent to 78, and the North West, which fell by 95 per cent to 261.

This was followed by the East of England and East Midlands which both fell by 94 per cent to 246 and 194 transactions respectively.

StripeHomes managing director James Forrester said: “This [EWS1] requirement has seen many sales drag on for months on end, with inspectors unable to facilitate such a huge level of inspections and banks refusing to provide mortgages until they do.”

He added that despite altered government advice which urged lenders to stop asking for the document on properties under 18 metres tall, there was an “industry stalemate” as banks refused to lend unless official Royal Institution of Chartered Surveyors (RICS) advice was amended.

Forrester said: “Ironically, while they drag their heels, thousands of new-build homebuyers remain in limbo and it doesn’t look as though a solution is on the horizon anytime soon.”

The report added that on average, new-build homes sold for £314,000 between January and June, which was six per cent up on the same period last year.

The West Midlands experienced the biggest growth, with new-build homes selling for £299,998, which is up from £250,000.

This was followed by the North East, where prices grew by 17 per cent to £239,950, and South West, which was up by 14 per cent to £337,748.

All regions experienced price growth bar three regions, with new-build prices in Yorkshire and Humber contracting by £40,050 to £174,950, whilst newly built homes in the North West fell by six per cent to £211,000. In the East Midlands, new-build prices decreased by one per cent to £252,498.