Why You Should Invest In New Build Property
Invest in New Build Property
Want to help the UK alleviate the pressure of the housing crisis? Want the rewarding feeling of following a project from humble beginnings into a fully fledged product? By deciding to invest in new build property you could get satisfaction on both fronts.
What is a new build property?
A new build property can simply be defined as a house that was has been built recently. No surprises there then! Many new build properties are being built in the UK in a bid to try and meet the demand of buyers who are currently embroiled in the midst of a housing crisis. Only last year the government pledged to build 300,00 homes-a-year by the mid-2020s. However, it emerged this year that the figure needed to sustain the current demand in the UK far exceeded the original estimation- by 40,000 in fact. This when combined with the outstanding backlog of around 4m homes, quickly turned the whole thing into a bit of a nightmare scenario.
The UK Housing Index estimated that the current shortage of houses in the UK contributes to a nationwide increase in property value and that the 28 million homes already in the UK are expected to grow in value by a staggering 4.2%.
Wh you should invest in new build property
With such a demand for housing in the UK comes an even larger demand for supply. This is just one of many reasons why new build property is proving so financially viable for many investors. With property prices rising on the whole across the UK, property investment has never been so lucrative. You build a house and it’s more than likely that somebody is going to want to buy it.
With new build property, you also have the added benefit of being able to source a good location to make your investment. It’s no secret that property developers will be looking to make a lot of money of the back of their developments. As such they will have invested a lot of time and effort into researching the area and scouting out the potential buyers. Whilst not always the case, many new developments are in areas expected to be ‘up and coming’ – or are already in high demand. This paired with the ever increasing demand for property, should put you in good stead for making a return on your investment.
By investing in a new build property, not only are you putting yourself in a good position to make a decent return from your investment, but by investing in new build property you are actively helping to provide good quality housing for those who need them most. New build properties are especially attractive to young buyers, who may be looking to get onto the property ladder. Schemes such as help to buy are quite common with new build developments and have been introduced by the government in an effort to get people on the first rung of the ladder.
The House Crowd’s peer to peer development loans
At The House Crowd we have one arm of the business dedicated to building and raising funds for new developments – these are referred to as peer to peer development loans. We believe that our development loans offer an ideal opportunity to invest in new build property. We believe that we’ve cooked up a fairly unique business model that allows our investors to earn high returns from – property development without the need for any involvement from the banks.
All of our developments are based in the North West, not that we’re biased (maybe we are). For what reason you ask? Well for starters the North West is leading the charge of the recent property boom across the UK; many houses across the region have increased in value and continue to deliver considerably higher yields than the rest of the country.
In addition to this, our team are born and bred in the North West. Because of this, we are able to offer in-depth, concise insights to our investors. In the North West, first-time buyers pay an average deposit of £19,000, equivalent to around 54% of their annual income. This statistic in London however, translates to around £99,573, which is 149% of their average income. Not only this but stamp duty in the North-West comes to around £3,000. In London, this is once again escalated to around £25,700. In short, it’s far easier for young people, graduates and first-time buyers to get on the housing ladder.
It is this moderate sensible growth that underpins the demand for housing in the North West and cements its position as the country’s brightest flame.