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New Build house prices rise 17% with support from Help to Buy, says ONS

Prices of new build properties in England increased over 17% in a year with record loans from the government’s Help to Buy scheme.

Data from the Office of National Statistics (ONS) shows property values of new build homes are 17.6% higher year-to-year to the month of July supported by a record value of loans from Help to Buy.

On average property values of new build properties is £326,381 which is higher than the £238,125 paid for resold homes.

The government’s Help to Buy scheme support first time buyers and home movers to purchase their homes and in the past year has advance £2.54 billion of loans in England.

There have been 42,694 homeowners in England using Help to buy over the year of which 80.8% or 34,533 were first time buyer.

Strong rise in new build prices

Property prices for new builds in England have risen significantly more than existing resold homes which are up on average by only 4.6%.

The following table from the ONS shows average prices and annual change for new build homes in the UK to June 2017.
Region Annual change
Average prices
London 14.4% £543,706
South East 15.5% £405,919
East of England 19.3% £390,679
England 17.6% £326,381
South West 19.6% £321,427
West Midlands 20.0% £278,667
East Midlands 19.8% £268,990
North West 17.1% £228,388
Yorks and the Humber 17.4% £216,903
North East 3.8% £209,044
House price growth in London is the slowest in the UK compared to other regions up 2.8% year-on-year and this is the first time this has happened since May 2009.

Even so the rise in house prices in the capital allows the older equity release mortgage buyer to stay in their home while accessing the wealth in their property, using this for any purpose such as improve their quality of life.

For remortgage buyers higher prices give them an opportunity to release capital which they can use to improve their home.

House prices for new build properties in the capital are up 14.4% for the year although for a month prices are lower by -3.0% due to affordability and difficulty to arrange a mortgage or find a large deposit.

Prices are also lower across England down -1.9% although over a year prices in the West Midlands are higher by 20.0% followed by the East Midlands higher by 19.8% and the South East up 19.6%.

The highest house prices paid for new build homes is in London at £543,706 and this is 11% higher than the average price for the capital at £488,729.

Help to buy used across England

Help to Buy equity loan was launched in April 2013 and by June 2017 there have been 134,558 completed purchases with a value of loans at £6.72 billion.

Of this 80.7% or 108,620 are first time buyers with value of loans at £5,26 billion and the remaining 25,938 are home movers.

London represented a small proportion with only 6.5% or 8,813 home bought using Help to Buy which is very popular in other regions across England.

The median price paid by first time buyers using Help to Buy was £204,950 and in London this increases to a median price of £379,950.

Help to Buy equity loans allows both first time buyers and home movers on purchase new-build property valued up to £600,000 with a maximum loan of £120,000 or 20%.

In Greater London loans can be up to £240,000 or 40% although these schemes are not available for second homes or buy-to-let properties.

What are your next steps?

Call our LCM mortgage brokers for advice if you are a first time buyer, want to remortgage your existing home for the best mortgage deal, moving home or are a buy-to-let investor.

Start with a free mortgage quote or call us and we can take your details.  Learn more by using the property value tracker chart, mortgage costs calculator and equity release calculator.

For equity release buyers our London City Mortgage advisers can recommend lifetime mortgages allowing you to receive cash from your property to consolidate debt or gift to a child or grandchild the deposit on their first home.

Use your dashboard to access online mortgage quotes, money off vouchers and start your mortgage application online 24/7 on desktop, tablet or smartphone.

Mortgage Best Buys

These are examples of mortgage products we can approach with many more offering interest rates and flexibility to meet your needs.

1.21% Fixed Rate
60% Loan to Value
£1,034 Lenders Fee
Until 30/10/2021
Reverts to 4.24%
1.47% Tracker Rate
60% Loan to Value
£1,024 Lenders Fee
Until 2-Years Time
Reverts to 4.24%
1.44% Tracker Rate
60% Loan to Value
£1,034 Lenders Fee
Until 2-Years Time
Reverts to 5.24%
1.33% Tracker Rate
60% Loan to Value
£1,025 Lenders Fee
Until 31/01/2022
Reverts to 4.24%

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    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.


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