New homes set for steep price increase
Posted: 16 Jun 2006 09:24:03 GMT
Buyers of brand new homes can expect to see prices soar in the next 12 months, according to a new report.
Homebuilders are reportedly expecting a ten per cent increase in the average price of new houses by June 2007, which is thought to be evidence of high levels of confidence in the property market.
According to a survey carried out by SmartNewHomes, 70 per cent of homebuilders are expecting an increase of this magnitude, following strong price increases in the first five months of 2006.
Affordability remains the biggest concern and homebuilders acknowledge that this will ultimately cap house price growth at some point next year. As a means of combating these affordability constraints, most homebuilders are in favour of the competition launched by the government that will see developers looking to build a £60,000 house.
But the price increases on new homes may well prove too much for many homebuyers and this will seemingly help to sustain enthusiasm for older properties.