Housebuilders are maintaining asking prices despite around one in eight new-build properties remaining unsold after six months on the market, according to analysis by specialist lender Octane Capital.
The data shows that developers are prioritising profitability over sales velocity, with a quarter of new-build homes on the market for longer than three months. Approximately 13% have not attracted a buyer for more than six months, whilst 4% have remained unsold for over a year.
Limited price reductions
Based on an estimated 34,831 new-build homes currently for sale across England, the figures suggest around 4,400 completed new-build properties remain unsold after six months. However, only 14.5% of all new-build homes currently for sale have undergone an asking price reduction.
Jonathan Samuels, Chief Executive of Octane Capital, said: “The immediate assumption is often that if new-build homes aren’t selling quickly, developers will simply reduce prices, but in reality that’s often the last option they want to consider.”
“Every discount comes straight off the bottom line and, after several years of planning, construction and rising build costs, protecting profitability has become more important than ever,” he added.
Developer exit finance
Samuels explained that many developers prefer to extend sales timelines rather than reduce property values, particularly where market conditions remain relatively stable and buyer demand continues. This trend is similar to challenges seen across the property sector, with regulatory pressures affecting various segments of the housing market.
The lender noted that developer ‘exit finance’ has become increasingly significant, providing developers with the ability to refinance completed schemes, release capital and continue selling without pressure to accept lower offers to satisfy approaching loan maturities.
The data suggests that despite slower transaction times, new-build developers are maintaining a disciplined approach to pricing, reflecting confidence in underlying market fundamentals and a determination to preserve profit margins following years of rising construction costs.
