It is quite common for the purchase price of a new-build property to attract a premium, but a recent survey by Unlatch has discovered that they can also command up to a 28% rental premium compared to older stock on the market. Here we discuss some of the many benefits landlords can realise when purchasing new-build properties as part of their rental portfolio.

Rental income premiums up to 28% in the South East In the South East the rental premium attached to new-build homes is as high as 28%but, rental yield aside, there are other considerations when adding a new-build property to your portfolio.  

New-build is more energy efficient

As the government legislates to encourage greener homes, the onus falls to landlords to ensure their properties are compliant.  As a result, there has never been a better time to snap up a new build property that meets the latest energy efficiency standards.  Both landlord and tenant will benefit from the brand new boiler systems, the ultra-insulated roofs and walls and the shiny, new double-glazed windows.

Rather than trying to continuously improve a draughty Victorian terrace to turn it into an energy efficient home, why not invest in a new property with those energy efficiencies built in? With today’s sky-high energy prices, energy performance is more important than ever to potential tenants when selecting a rental property. As far back as 2017 it was reported by Energy Performance Certificate data that new-build homes save owners up to £629 a year on energy bills! With savings like this your chances of having a property standing empty for a prolonged time are significantly reduced, even if the rental price per month is typically higher than average for the area.

Fewer repairs and less maintenance

When buying any property, there are inevitably unforeseen repairs and maintenance costs. In an older property damp walls and draughty windows cause problems, and the need to repair them to ensure your tenants’ health and well-being cannot be ignored. With an older property, it can be harder to uphold a decent standard of living for your tenants without spending potentially significant sums, not to mention time, on rectifying issues that arise.  

Most new-build homes come with a structural guarantee, which means you are covered for any major issues. That structural guarantee is a reassuring part of the new-build purchase package that savvy landlords would be glad to take advantage of.

Built for modern life

As our lifestyles change, so too does the way we use our homes. There has been a huge shift in what people need and expect from their home since Covid-19 and that of course extends into the rental market. New-build homes are designed with modern life in mind. They have sleek lines, smooth walls and efficient layouts. The luxury of a brand-new home has instant appeal. As potential tenants’ step into a newly painted, freshly carpeted house they can see themselves living there with ease and convenience (another highly desired aspect of modern life).

An already attractive layout also means less need for landlords to adapt and carry out works once they have purchased the property. It is rare that an older property requires no tweaks once a landlord has purchased, so this can only be considered a bonus!

Older homes of course have their own charm but have been working to catch up with new builds in their quest to deliver in modern times. A brand-new, modern home stands to reduce void time, allowing landlords to keep their focus on getting the right tenant in fast.

Whether you invest in a brand-new property or choose to stick with traditional homes to house your tenants, Maddisons Residential are here to help. For more information about our brilliant lettings service, please get in touch with our friendly team on 01892 514100.