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Is New Build Property Investment a Good Idea in 2024?

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    Are New Builds a Good Investment in 2024?

    While there are many property investment strategies, one of the most popular in 2023 was a new build property investment strategy.

    New build houses are an attractive option for many property investors, with lower maintenance costs and supplied modern furnishings having a clear advantage over an existing property.

    But with the so-called ‘new build premium’ seeing house prices rise to new heights, you may be unsure if a new build investment is the right choice.

    The following article will help clarify this by discussing whether new builds are a good investment in 2024.

    Topics include:

    • Why invest in new builds?
    • Where to buy a new build property?
    • Top tips for buying new build properties
    • The best alternative property investments in 2024

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      Why Invest in New Builds? 

      Buy-to-let property has become a hot commodity in 2023,  following record-breaking years in 2020 and 2021.

      Investing in real estate is one of the best ways of generating passive income, allowing investors to earn solid streams of rental income each month whilst also offering an exit strategy in which you can enjoy a huge cash payout further down the line.

      Very few investments can offer the impressive capital growth that property offers.

      For example, over the last 20 years, Liverpool has seen an average property price growth of over 211%!

      It’s also a safe investment.

      For instance, take a look at the COVID-19 pandemic.

      Despite the UK economy suffering severely in some areas, UK property prices increased at the fastest rate since 2004. In comparison, at the same time, the stock market experienced its worst crash in 2020 since 1987.

      Factoring in that the average rental income in the UK as of November 2023 is now at £1,279 per month – up 9.63% compared to 2022, according to HomeLet – and it’s understandable why so many people are thinking of investing.

      But are newly constructed properties the way to go? Let’s find out by looking at the pros and cons of buying a new build investment property in 2024.

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      Pros of Making a New Build Property Investment

      Ready to Move In

      One of the best parts of new build property investments is moving in your tenants on day one.

      As new builds will typically come fully furnished with all the needed white goods, property investors can instantly start seeing returns on their investment.

      While you’ll still have to find a tenant before you can start earning, you can often secure a tenant before the property has even been completed if you hire a property management company.

      More Energy Efficient Than Existing Properties

      With sustainability becoming an increasing priority for homeowners and tenants, new build properties have a distinct advantage over older properties thanks to them usually having a top energy efficiency rating.

      According to the Energy Performance Certificate data, around 80% of new builds have the top energy efficiency rating of A or B.

      Research from Forbes in 2019 found that 54% of Gen Z and 5o% of Millennials were willing to spend 10% more on sustainable products – making energy-efficient real estate a major attraction.

      Energy-efficient properties are also good for the wallet of a property investor, with homes with high energy efficiency not needing additional spending on features like double glazing or new boilers.

      This year also saw the introduction of new EPC Rating regulations, expected to be implemented over the next few years, in which many landlords will have to spend a considerable amount to ensure that their properties are up to scratch energy efficiency-wise.

      The good news is that those who purchase new-builds or off-plan properties will often experience a more cost-effective investment in comparison, as energy-saving features are likely to be part of the investment already.

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      Low Maintenance Costs

      As new builds are brand-new properties, fewer maintenance costs are needed for the first few years of ownership.

      This is a significant benefit for property investors, who won’t need to spend money on ensuring that the property is in a good state for renters.

      Easier Buying Process

      New build properties are usually purchased directly from the developer of the project, which can often dramatically speed up the buying process.

      This is often a “chain-free” transaction, as buyers don’t need to wait for individual sellers to secure a mortgage to buy another home.

      Cash Discounts Available

      Many new build properties can be purchased off-plan, which means buying a property that hasn’t yet been completed.

      While this can be risky, the advantage is that developers will often offer incentives to convince you to invest. This can include free furniture packages and price discounts.

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        Cons of Making a New Build Property Investment

        Tend to Be More Expensive Than Existing Property

        The major downside to new build properties is that the average price can be more expensive than older properties.

        Referred to as a “new build premium”, new houses are often valued at a higher cost than older properties.

        According to the latest new-build Land Registry data on the UK House Price Index in August 2023, the average new-build property cost £430,202 – Over £100,000 more expensive than the price of an existing property.

        While this price can be wildly different depending on what type of property you buy (i.e., an apartment versus a house), you may have to spend extra on a new build home.

        Of course, the trade-off here is that new homes will often be preferred by renters to older homes, with the ability to live in a house that has previously not been lived in before.

        Due Diligence is Vital to Avoid Delays

        When assessing a housing development, it’s vital to research the company behind the development thoroughly.

        This is important as low-quality developers could lead to significant delays, with research from New Homes Review reporting that 37% of new builds aren’t completed on time.

        More significantly, the developer could go bust while you’re waiting for your home to be completed, leaving you in a tough situation.

        Although this is very rare, your best bet is to research the developer by looking at its past track record and past reviews. If the developer’s website doesn’t show its track record or reviews, then this will likely mean you should avoid investing with them.

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        Off-Plan vs Completed Property

        The ultimate guide to help you choose whether to invest in off plan or completed property in 2024.

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        More Potential Monthly Charges

        Most new build properties are found in an entire development, whether that be an apartment block or housing development.

        This typically means properties are leasehold and can incur extra monthly expenses like ground rent. While they won’t be huge fees, it’s essential to make sure you can afford it alongside other costs like monthly mortgage payments.

        Build Quality Can Be Lower

        Depending on the project developer and how they try to cut costs, many new build properties can be of substandard quality.

        A report from New Homes Review found that 91% of new home buyers found defects in their new build homes after snagging surveys.

        While these issues are often minor and should be fixed for free by the developer, it can be inconvenient to delay moving in your tenants.

        This is why paying for a snagging survey before completion is vital, and researching the developer to ensure this isn’t a common issue amongst their properties.

        Less Room for Price Negotiation

        When buying homes from individual buyers, you can usually negotiate for a lower price. However, this is not the case with new builds due to the extra incentives attached.

        This shouldn’t be too much of an issue, as you’re likely already saving thousands of pounds by buying a new build property with a top developer or investment company but it is worth keeping in mind when securing your investment.

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          How to Pick the Right New Build Property 


          The first, and perhaps one of the most critical factors you need to consider, is the location.

          Picking the right location is vital in property investment. There are substantial regional variations in the UK in house prices, rental income, rental demand, rental yields, and capital growth potential.

          By picking the right area for rental properties, you’ll be able to maximise your chance of a successful property investment.

          You’ll need to analyse the local market and new build market to do this. You can do this by thinking about a few crucial measurements.

          They are:

          • Affordability.
          • Average rental income.
          • Average rental yields (the return on investment earned from rent every year).
          • Employment opportunities.
          • Transport links/infrastructure.
          • Regeneration potential.
          • Capital growth/house price growth predictions.

          You can read our complete guide to the best places to invest in UK property to learn more about this.

          Where Should You Invest in New Build Properties?

          For our money, the top two locations to buy new build properties in UK 2024 are Liverpool and Manchester.

          Not only do these cities have substantial rental demand and affordable prices over £60k below the UK average, but they also have some of the highest house price growth potential in the UK – an essential measurement for those looking to earn money from selling their properties later down the line.

          Research from Savills has found that the North West has the joint highest predicted capital growth rate in the UK, offering a 20.2% rise in property prices by 2028.

          Different Types of Property Investment

          Property Type

          Another important factor is to choose what type of property you’re looking to buy.

          The reality is that you can invest in several different strategies by buying new build properties, including commercial real estate, student property investments, city-centre apartments, or family homes.

          Which property type and strategy you choose will likely depend on how much money you can spend and your investment goals.

          For instance, student properties and city centre apartments will be far more affordable than a family home.

          While this will mean less capital growth in the long term, you will enjoy higher rental income and rental yields due to the lower prices.

          The type of investment you choose will also impact the location you pick. For family homes, you’ll likely want to invest in more rural areas or somewhere outside of the city centre.

          For student property, you’ll want to buy properties close to university campuses and will want to consider the student population of a city – you can learn more by checking out our blog on student property investment in 2024.

          And finally, city centre apartments will likely mean you’re targeting young professionals, which means you’ll want to target properties with good transport links nearby.

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            Covid-19 and the introduction of hybrid working have dramatically changed what tenants want from their homes in 2024.

            According to research from Benham and Reeves, the top three most essential features in a rental property are now high-speed Wi-Fi, access to outdoor space, and nearby green space.

            As such, you’ll want to find properties that meet this criterion to ensure your property generates as much long-term interest as possible.

            The great news is that several new build properties already have these features to meet modern demand, which means you can feel confident knowing your investment will likely generate high interest.

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              Top Tips for Buying New Build Properties 

              Buy Off Plan for the Best Savings

              To get the most bang for your buck, it’s a good idea to buy new build properties off the plan.

              Off-plan property is a property that’s available for purchase but hasn’t yet been completed.

              While this sounds risky and means that you’ll have to wait for your property to be completed, the trade-off is that you can save thousands on your purchases.

              For instance, here at RWinvest, we specialise in off-plan properties and offer some developments at over 55% below market value.

              You can learn more about why investing in off-plan property is a smart choice by clicking the link. Remember, though, that due diligence is key, and you should research developers to ensure they’re reliable.

              Make Sure Your Property Is Protected By NHBC Warranty

              One of the significant benefits of buying a new build property is that many are protected under the NHBC Warranty.

              This warranty lasts for 10 years and will protect up to a 10% deposit in the time before the property is finished. And for the first two years, the NHBC will help you with any disputes regarding faults with the building work.

              However, not all properties are protected by this warranty, so be sure to check with the developer or investment company to ensure your investment is as protected as possible.

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              New Build Properties for Sale in 2024 With RWinvest

              Thinking of buying an investment property?

              We’ve got a tonne of opportunities in 2024 that are available to purchase with us here at RWinvest.

              The following section will show our top new properties in 2024 with some details all buy to let investors need to know. We’ll also explain who we are, what we do, and why investing with us can be a top choice.

              Top Pick: Embankment Exchange

              The newly launched Embankment Exchange is one of our best-ever property releases.

              These pair of residential riverside skyscrapers are located in the heart of Greengate, an exciting regeneration zone in Greater Manchester.

              Available at over 34% below market value and with 6% projected returns, Embankment Exchange comes equipped with the latest eco-technology and modern facilities every tenant wants in 2022 and beyond.

              This includes a spa, on-site gym, luxury residents lounge, and a 24-hour concierge.

              With 1, 2, and 3-bedroom apartments available, you don’t want to miss out on investing in this young professional haven, with 80% of stock already sold out.

              You can learn more about this exciting opportunity by clicking the following link for Embankment Exchange.

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              Are You Ready For a Property Investment? Things to Consider in 2024

              While we think making a property investment is a top choice in 2024, it’s only good if you’re ready for it.

              With that in mind, here are some tips and things to keep in mind when deciding to make an investment this year.

              Landlord Responsibilities

              By buying a rental property, you’re likely going to become a landlord.

              But landlords aren’t just there to provide a home and earn rent, with many UK regulations dictating the responsibilities of landlords.

              This can include maintenance work, ensuring all gas and electrical items are safely installed, providing an Energy Performance Certificate, and more.

              If you lack the skills needed to do repairs, you could end up spending thousands. This is important to keep in mind.

              You can check out the full details of your landlord responsibilities on the government website.

              The Cost of Property

              Property can get expensive, with mortgage deposits, stamp duty fees, and legal fees making property expensive to buy.

              In fact, in our blog post, how much money do you need to invest in property, we found that you’ll require around £30k as a minimum to buy a property worth £100k.

              And that’s not even factoring in the maintenance and running costs involved with property investment, which can include ground rent, monthly mortgage payments, and more.

              Remember, too, that you may not always have rent to cover this, as your property could be vacant for months if you’re unable to find a tenant.

              While you can avoid this as much as possible by buying new build properties attractive to tenants, you need to ensure you have a rainy-day fund to cover your expenses if the worst happens.

              You Don’t Need to Invest Near Your Home

              Most investors opt to buy investment properties near their homes to manage them themselves.

              This can be a mistake, though, if the area you live in has a poor-performing housing market.

              As such, don’t be afraid to invest in other cities that have better-performing markets. While you won’t be a hands-on landlord, you can hire a property management company to handle all of your landlord duties.

              This will allow you to have a completely hands-off investment – key for those with a full-time job.

              2024 UK Property Market Forecast Out Now

              Get the latest projections for the UK property market in 2024 with our latest guide.

                Make a New Build Investment With RWinvest in 2024

                We hope you enjoyed our blog on new-build property investment.

                If you want to make a property investment in 2024, be sure to contact us today and speak to one of our property experts to learn more about the latest opportunities for you.

                Alternatively, if you want to learn more about investing in new builds, check out our blog post answering ‘do new builds increase in value over time?‘ for more insight into new build investment.

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                Dale Barham

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                Dale is a property content writer at RWinvest. Keeping a close eye on the UK property market, Dale helps our readers stay informed and up to date on the latest market news and statistics.


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                  I have had the pleasure of experiencing exceptional customer service from RWinvest. Adam and Michelle were remarkable and were exceedingly supportive in facilitating the acquisition of two properties in Liverpool, at "The Gateway." Their guidance was instrumental in the purchase of the properties and I express my utmost satisfaction with their assistance, and I am inclined to not only endorse but also consider any property advertised by RWinvest.

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                  I am very happy and satisfied with RWinvest. Their team was always responsive, supportive and friendly throughout my investment process. Thomas from RWinvest team was especially very supportive and he made sure that I have all the necessary information at the right time. He helped me with all my queries, and helped me to complete my investment process smoothly and with peace of mind.


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