Welcome to the latest edition of Rightmove’s Little Blue Book, packed full of property data, trends and analysis to help you plan for the year ahead.
Inside you’ll find trends for new homes starts and completions, a look at Help to Buy completion numbers and purchase prices, as well as supply and demand distribution for new homes properties on Rightmove.
As 2020 marks 20 years since Rightmove’s launch, we also invited some friends from the wider industry to share their experiences of the how things have changed since 2000 and look at what’s just around the corner.
You can download both editions of the Little Blue Book 2019/20 below, or, if you’d prefer a hard copy but haven’t received one just let your Rightmove Account Manager know.
Top features for New Homes Developers:
Starts and completions in England, Wales and Scotland
New build starts and completions are at their highest point since 2007, with over 198,000 starts and 190,000 completions reported in 2018.
In 2018, new build starts were 51.2% higher than in 2010 when the sector began its recovery. England and Scotland made the largest contribution to this rise, with an increase of 53.5% and 54.5% respectively, whilst Wales remains stable with an increase of 1.0% in the same period. Looking at completions, England leads the way with a 54.0% rise, with Scotland up 19.5% and Wales up 3.6% on 2010’s levels1
More recently, completions in England have risen 11.9% year on year in the first half of 2019, with 80.8% of all new build completions being delivered by private enterprises. Starts have dropped 10.7% in the same period.2
Turn to pages 28-29 of your Little Blue Book to see more.
Sources: 1Ministry of Housing, Communities and Local Government. 2Ministry of Housing, Communities and Local Government October 2019 – England.
Help to Buy completions and property prices
Since the launch of Help to Buy in 2013, over 221,000 Help to Buy completions have been reported in England.
In 2018 there were 52,124 completions, 10.8% of which were in the capital. In the first quarter of 2019 Help to Buy completions rose 2.8% year on year across England, with a stark increase of 42.8% in London. In Scotland and Wales the equivalent schemes reported 4,219 completions in 2018.
Nationally, the average purchase price for property sold under the Help to Buy equity scheme in England is £300,487. 85.0% of Help to Buy purchases in England are first-time buyers, with an average purchase price of £294,920. For non-first-time buyers, the average Help to Buy purchase price is 11.9% higher at £330,051.
In London, the average purchase price for property sold under the Help to Buy equity scheme in London is £453,274. 96.2% of Help to Buy purchases in London are first-time buyers, with an average purchase price of £451,957. For non-first-time buyers, the average Help to Buy purchase price is 8.1% higher at £488,590.
The government plans to introduce a new version of Help to Buy in England from March 2021. The new scheme will be restricted to first-time buyers and will include lower regional caps outside of London.
Turn to pages 30-31 of your Little Blue Book to see more.
Sources: 1Ministry of Housing, Communities and Local Government. Welsh Government, Help to Buy – Wales Shared Equity Loan Scheme 1,849 completions. Scottish Government, Help to Buy (Scotland) Affordable New Build scheme 2,370 completions. 2HM Treasury 3 Ministry of Housing, Communities and Local Government
Supply and demand distribution by bedroom number
Nationally, 65.7% of all new build stock is houses, accounting for 63.6% of leads. Although this appears balanced on the surface, when we look at the numbers based on bedroom number, we can see an imbalance in the distribution of stock versus demand. While four and five-bedroom houses make up 37.2% of new build stock, they only receive 27.5% of leads.
Comparatively, demand for two and three-bedroom houses outstrips supply, with 27.8% of stock compared to 35.2% of leads. Flats present a much more stable picture across all bedroom numbers, with demand meeting supply at a national level.
In London, 90.0% of new build stock is flats, however supply is outstripping demand as they only receive 80.4% of leads. This imbalance is spread across all bedroom numbers, but is most noticeable for three-bedroom flats, accounting for 15.9% of stock compared to 12.8% of leads.
Looking at houses, supply of one, four and five beds meets demand. The biggest opportunity is for three-bedroom houses with demand far outstripping supply (17.6% of leads versus 8.0% of stock).
Turn to page 32 of your Little Blue Book to see more.
Your Rightmove Account Manager can help you research supply and demand for specific property types in your area to help your land acquisition team make data driven decisions about what to build and where. Speak to your Account Manager to find out more.
Source: Rightmove data October 2019
How Build to Rent supports housing delivery
As supply of rental properties has dropped year on year, demand for quality accommodation continues to grow. The Build to Rent sector presents an opportunity to balance the scales in the UK’s major cities, where quality rental stock to suit “lifestyle renters” is at a premium.
We spoke to Stephanie Pollitt, Assistant Director of Real Estate Policy at the British Property Federation to understand how Build to Rent supports housing delivery. Here’s what she had to say…
“The UK is suffering from an acute housing shortage, and the government has made clear its intentions to increase housing targets to 300,000 new homes each year.
Housing of all tenures will have their role to play and the Build to Rent sector offers a unique opportunity to not only provide high quality rental homes for those who want or need to rent, but also to help support the delivery of new homes. Local authorities across the country are beginning to recognise the sector’s capacity to support them in boosting housing delivery.
There are now 142,999 Build to Rent homes completed and in planning across the UK, an increase of 17% over the past year, with London accounting for 52% and the regions 48% of the total.
Leading the charge for innovations in the wider market such as fixed, longer term tenancies and index-linked rents, the sector is helping to provide more transparency and greater security for renters. Many also offer additional services such as gym memberships, broadband and a 24-hour concierge.
Dispelling the myth that it is a high-end niche product and with most providers in the sector aiming their product squarely at the mid-market, Build to Rent is becoming increasingly accessible to a wide range of people and providing a high-quality option in the UK’s private rented sector.”
Turn to pages 24-25 of your Little Blue Book to see more.
Sources: 1British Property Federation (England, Scotland, Wales) 2Savills research