New builds lose value... discussion?

girl_withno_name

Hi all - before I get mocked, I have used the search facility before posting here...

Quite recently there was a thread discussing whether new builds lose value quickly (like new cars as soon as they're driven off the forecourt)

Now I can't find it, but was interested in people's opinions and experiences on this matter - can anyone help track it down please?

Thanks

sirmosh

No doubt they do, although when times are good if you've lived there a few years prices will have risen a bit and you might get what you paid for it. For people who bought 5/6 years ago they're losing out massively.

Also you often pay extra for decoration but this obviously doesn't really add any value so you've already paid more than it was worth at the time on top of the builder's margin.

Credit-Crunched

IN addition, many new developments have fallen at the mercy of DSS tennants. The council basically guarantees rents to landlords, so people that are struggling to sell or developers that want a return let or sell to councils.

This % of DSS housing detracts from the value of the surrounding property. (not arguing over the morals on this, it is fact)

brit1234

Also builders tend to overvalue to make best return as they are a company (shareholders) rather than individuals

G_M

Find a new development ( a larger one) which is nearly but not completely finished.

Look at the prices being asked (and the prices being obtained) by the developer for new properties.

Then look at the properties which were sold 6 months ago, and are now back on the market (there will be a few).

The different properties will be virtually identical, but the brand new ones will be noticably more expensive.

Think about it. If the prices were the same, everyone would want to buy the brand new one (wouldn't you?). Hence owners wanting to leave the Development have to sell at a lower price.