Interesting new research from Arygyll Property Partners suggests that a good combination of value for money, house price growth and demand is key to the UK’s best location to build a new property.
Taking this into account, Argyll’s analysis shows that Leeds offers the best mixture. New build homes here are worth 41% than existing properties in the city on average. In addition, new builds have risen in value by 13% year-on-year.
New Build Properties
Data from the report shows that the top 10 local authorities for building new homes were:
| Region | Major residential planning applications granted | New build property price increase (YoY) | New build value compare to existing homes | Monthly Transactions compared to average for a local authority | Weighted Ranking |
| Leeds | 95% | 13% | 41% | 380% | 1 |
| Birmingham | 96% | 14% | 40% | 373% | 2 |
| Cornwall | 80% | 11% | 8% | 355% | 3 |
| County Durham | 85% | 12% | 59% | 244% | 4 |
| Wiltshire | 84% | 14% | 29% | 215% | 5 |
| Bradford | 94% | 11% | 42% | 201% | 6 |
| City of Bristol | 91% | 13% | 12% | 180% | 7 |
| Manchester | 95% | 13% | 23% | 153% | 8 |
| East Riding of Yorkshire | 87% | 12% | 41% | 145% | 9 |
| Liverpool | 97% | 11% | 55% | 139% | 10 |
Brian Markovitz, Director of Argyll Property Partners, observed: ‘Developers should head to Leeds if they’re looking to build homes in England. Property values for new builds in the city are seeing double-digit growth as increasing employment drives demand for homes. The significant gap in the price of new homes compared to existing properties means there are healthy profits to be made, while the high transaction figures suggest homes should be relatively easy to buy and sell.’
‘Leeds City Council is also one of the best for encouraging house building, approving almost all of the major applications it receives. Major new developments such as the Seacroft site in the east of the city suggest many are already discovering the opportunities Leeds has to offer for house builders,’ he continued.[1]
Where are the best (and worst) locations for new builds in Britain?
Worst New Build Regions
On the other hand, Surrey Heath in South-East England was found to be the least attractive location for new build homes. High property values in Surrey mean that developers have to pay a premium price to ensure a site, in comparison to other regions of the country.
The worst 10 local authorities for building new homes were found to be:
| Region | Major residential planning applications granted | New build property price increase (YoY) | New build value compare to existing homes | Monthly Transactions compared to average for a local authority | Weighted Ranking
(out of 324) |
| Surrey Heath | 75% | 7.24 | -23% | -52% | 324 |
| Hambleton | 75% | 4.44 | 24% | -55% | 323 |
| Epsom and Ewell | 38% | 8.64 | 12% | -50% | 322 |
| Ribble Valley | 86% | 2.69 | 49% | -66% | 321 |
| Richmondshire | 85% | 4.22 | 35% | -64% | 320 |
| Pendle | 77% | 0.96 | 62% | -43% | 319 |
| Spelthorne | 50% | 9.27 | -1% | -41% | 318 |
| Three Rivers | 67% | 6.89 | 30% | -58% | 317 |
| Hammersmith and Fulham | 80% | 5.23 | -2% | -17% | 316 |
| Islington | 79% | 6.86 | -2% | -31% | 315 |
Mr Markovitz concluded by saying: ‘For developers, Surrey Heath doesn’t appear to be the best location for new builds. The higher land values in the area mean that profit margins will be squeezed. Despite Surrey Heath’s proximity to London, the large amount of Green Belt land in the area means home sales are also significantly lower than the average for a local authority. Renovating an existing home may yield better returns for anyone looking to invest in Surrey Heath. It’s also noticeable that two London boroughs feature close to the bottom as Stamp Duty, high land values and a decline in transactions combine to hamper Prime Central London’s attractiveness to developers.’[1]
[1] http://www.propertyreporter.co.uk/property/where-are-the-best-and-worst-locations-in-the-uk-to-build-new-homes.html