When is the best time to launch a new property development?
Despite a pending financial crash, pandemic and Brexit, the first quarter of 2021 saw 49,470 new homes built in the UK, according to gov.uk – the highest figure in over 20 years!
Additionally, September 2021, boasted a record high with the average UK house price reaching £270,000 which was £28,000 higher than the same period in 2020.
With so many new-builds up and coming, house prices rising and reports of a housing crisis, how crucial is timing when it comes to releasing new property developments to maximise profit?
We have a look at seasonal trends to consider when planning “build” timeframes.
New Year is traditionally a time of fresh starts and people will be thinking about the year ahead with new goals, aspirations and milestones. While this may seem like a good time to launch your development at first glance, there are a few negatives to consider.
Buyers looking early in the year tend to be towards the beginning of the buyer cycle which means making a sale may require more marketing touch-points and a longer sales cycle.
Selling off-plan is typical for new build development these days but if you’re looking to have your build ready for the beginning of the year, the poor Winter weather will usually result in build delays which can put buyers off – especially as they won’t want to be in “limbo” over the festive period.
Spring tends to be the most popular time of the year to buy and sell, multiple Bank Holidays and a long Easter break means that buyers have extra time to consider plans and arrange viewings without using precious holiday allowance from work.
The days get longer and warmer and generally speaking, people are happier and more motivated which means they will be more proactive in finding the house of their dreams. The brighter days are when properties look their best and gardens are in bloom. In addition, people with children are keen to buy properties at this time so they are in a position to move to a new home during the school holidays.
According to Attom Data, 91% of home buyers with children consider school boundaries important to their home search.
However, developers need to bear in mind that during this popular time, they can expect to be up against the greatest number of competing sellers and properties, as everyone else also tries to maximise their sales.
As people take summer holidays during July and August, buying activity tends to slow down so buyers and associated services, such as conveyancing solicitors and financial advisors, are away.
September tends to be another “turning point month” as people return to work and have a little urgency to move into a new home in time for Christmas. In the UK, September can often have good weather meaning that properties are still showing well.
Similarly to September, October is a great month for making sales on developments due to be completed the following year. In theory, buyers have spent September viewing plans and properties and may be in a good position to make decisions and whilst Autumn tends to see less buyers, those buyers tend to take the process more seriously!
In November, we usually see a bit of a drop off in the market until the end of the year as the focus is on Christmas and if sales / moves haven’t been completed by this stage, buyers want to wait until January…and so the cycle starts again!
Rightmove data suggests that mid-November is the worst time to put your home on the market with properties taking on average 79 days to go under offer.
So whilst there are definite seasonal trends across the board, it’s important to consider the type of house you’re marketing and whether it fits the rule.
1-2 bedroom flats and houses
If your target buyer for smaller properties are young couples (and often first-time buyers), the best time to sell this development is likely to be January, February and September because these buyers are often prompted after realising over the Christmas period that they’d quite like independence and need their own place. Christmas gifting may also contribute to new-found finances!
3-4 bedroom family homes
This property size tends to be aimed at buyers moving up the ladder, who already have children or are planning to start a family in the near future. The best time to sell to this buyer is likely to be during term time so that they can schedule their house move around the school holiday period and minimise disruption to their family.
Bungalows and retirement homes
Bungalows and retirement homes tend to appeal to downsizers or those approaching retirement / already retired. We find that these buyers are more active in the warmer months and will be less affected by buying trends around school holidays.
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Improvements in the capability of technology have meant that developers are now able to offer a lifestyle with accurate and realistic images of how a property will look and feel through Computer Generated Imagery (CGI) all year round. Over the coming years, we will start to see a shift in property buying trends and peaks will be less obvious as CGI revolutionises the market.
Seasonal trends will provide developers with a strong starting point on which to base their decision, but they should also take into consideration key influences such as local trends, supply and demand, political, environmental and social factors when deciding at what stage to come to market.
If you’d like to find out more about how to strategise your property marketing and maximise sales, give us a call on 01364 654267
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