As we progress quickly through the fourth quarter (Q4) of 2021, demand in the new-homes sector remains very strong.

Housebuilders’ trading statements and other market commentaries indicate that consumer appetite for buying — in particular new-build homes — is unseasonably high for this time of year.

As autumn turns into winter, big PLC housebuilders typically focus on completions, ensuring that buyers move into their new home before year-end, simultaneously boosting cashflow for the year ahead.

But there is still a very healthy demand from new buyers, thanks in large part to a number of unique trends that have evolved at the hands of Covid-19.

Forward selling

A significant number of large housebuilders are also reporting very healthy forward-selling figures, with many advising that their forward-sales position takes them to the end of Q2 2022 — further evidence of the continuing market demand that prevails.

From a builder’s perspective, there are still challenges relating to the supply and demand of key materials, but these issues are improving, slowly but surely, with time. This does, however, impact the overall build experience, extending the entire process by approximately four to six weeks.

A significant number of homeowners have never experienced a higher-interest environment

Other ongoing challenges include difficult access to trades and skills within the sector, but the outlook is considerably better when compared directly with Q2 2021.

Lender interest

Similarly, we have seen continued interest from lenders in the new-build sector, alongside an encouraging rise in the availability of higher loan-to-value (LTV) mortgages. But there’s still a way to go and we would like to see more lenders move up the LTV curve over the coming months, particularly for new-build properties.

Historically, there has been a lack of high-LTV products for new-build properties. As the government’s Help to Buy scheme nears its end in England — with the initiative set to close in April 2023, and keeping in mind builders’ current forward-selling position — the impact of this change is likely to be felt from the middle of next year.

It’s important to note the industry’s role when it comes to environmental responsibility

But it’s encouraging to see the housebuilding industry working closely with private enterprises, such as Generation Home, Deposit Unlocked and Market Mortgage, to launch initiatives that are designed to offer alternative ways for buyers with low deposits or limited income to achieve homeownership.

Rate rise

In more recent days — and perhaps most notably among industry professionals — there has been a considerable amount of noise surrounding the Bank of England’s looming base rate increase, which will have the biggest impact on homeowners that are coming to the end of fixed-term rate agreements. We’re anticipating the increase sooner than predicted.

Housebuilders are working closely with private enterprises, such as Generation Home and Deposit Unlocked

An entire generation of buyers are used to low interest rates and, although any increase will be low by historical records, a significant number of homeowners have never experienced a higher-interest environment.

Also, very topically and in line with the recent Cop26 conference, it’s important to note the industry’s role when it comes to environmental responsibility: not just for new-build properties but for proving technologies that can be retrofitted to existing homes.

Mobeen Akram is national new homes account manager at Mortgage Advice Bureau