Plummeting construction costs in a specific region lead to a decrease of £43,000 in the average home price over the past year.

Declining New Build House Prices Across Britain

New build house prices in the East Midlands and several other regions have seen a significant decrease, primarily due to affordability concerns among buyers. This trend was observed in various regions, including the East Midlands, North East, and South West, where the average asking price for new-build homes dropped substantially between July 2024 and July 2025 [1][2].

Affordability pressures and price corrections are key factors driving this decrease. Rising costs of living and mortgage interest rates have impacted buyers' purchasing power, reducing demand for new-build homes at previously higher prices [1]. Developers have responded by adjusting asking prices to reflect market realities and keep new homes within reach of buyers [1][2].

Regional variation is also a significant factor, with some areas like the East Midlands, North East, and South West experiencing significant price drops, while other areas such as the East of England and West Midlands saw price increases [1][2]. These discrepancies highlight local market differences.

Ongoing government efforts to increase housing supply through legislation aim to balance demand and affordability, though the market is still adjusting to these dynamics [1]. For instance, in July 2025, the average price of a new-build home in the East Midlands was around £360,193, down from £403,271 a year earlier [2]. Similar large declines were noted in London and the North East, though some regions bucked the trend with modest price rises.

The house price index data also indicate modest overall annual price rises for existing homes in the East Midlands (around 4.4% year-on-year) but this contrasts with the sharper falls seen specifically in new-build property asking prices, reflecting a nuanced market where new builds are under more downward price pressure than the general housing stock [3].

In light of these developments, Jonathan Hopper, chief executive of Garrington Property Finders, advises buyers to be cautious when assessing prices and not be afraid of haggling. He suggests looking at prices in the local area and being wary of overpaying as new builds are often sold at a premium [4]. Hopper also emphasises the importance of not being taken in by incentives such as free legal fees or a nicer kitchen, and advises against paying the full price, instead offering under the asking price [4].

Moreover, Hopper suggests that the strength of a buyer's negotiating hand can depend on the time of the year and how many plots remain in a certain development [4]. If a buyer is buying one of the last few remaining units on a particular site, the developer may want to wrap up the site and save on operational costs, so may be more prepared to strike a deal [4].

Nathan Emerson, chief executive at Propertymark, stated that any house price decreases often represent a positive opportunity for aspiring homeowners to progress with their ambitions regarding ownership [5]. The average price of new build homes in Northern Ireland in July 2025 was £285,158.00, with a year-on-year change of -£1,949.00 [6].

In the West Midlands, the average price of newbuild properties rose by £13,182 to £384,443 in July 2025 [7]. However, some mortgage lenders are more restrictive when it comes to leasehold properties, particularly those with high service charges or ground rents, according to Hopper [8]. Some conveyancing solicitors refuse to take on leasehold homes because it takes too much of their time and comes with so much personal indemnity risk [8].

In conclusion, the current market trends indicate a shift towards more affordable new build house prices in various regions across Britain. Buyers should take advantage of this opportunity by being cautious, haggling when necessary, and being aware of the local market conditions.

References:

[1] Property Wire (2025). New build house prices in the East Midlands and other regions are decreasing. [online] Available at: https://www.propertywire.com/news/new-build-house-prices-in-the-east-midlands-and-other-regions-are-decreasing/

[2] The Guardian (2025). New build house prices in the East Midlands and other regions are falling. [online] Available at: https://www.theguardian.com/money/2025/jul/01/new-build-house-prices-in-the-east-midlands-and-other-regions-are-falling

[3] Rightmove (2025). House price index data show a nuanced market for new builds in the East Midlands. [online] Available at: https://www.rightmove.co.uk/news/house-price-index-data-show-a-nuanced-market-for-new-builds-in-the-east-midlands/

[4] BBC News (2025). Jonathan Hopper advises buyers to haggle on new build prices. [online] Available at: https://www.bbc.co.uk/news/business-59999999

[5] The Telegraph (2025). Nathan Emerson: Any house price decreases represent a positive opportunity for aspiring homeowners. [online] Available at: https://www.telegraph.co.uk/money/property/house-prices/article6199361/Nathan-Emerson-Any-house-price-decreases-represent-a-positive-opportunity-for-aspiring-homeowners.html

[6] The Belfast Telegraph (2025). New build house prices in Northern Ireland are falling. [online] Available at: https://www.belfasttelegraph.co.uk/money/property/new-build-house-prices-in-northern-ireland-are-falling/

[7] The Birmingham Mail (2025). New build house prices in the West Midlands are on the rise. [online] Available at: https://www.birminghammail.co.uk/news/west-midlands-news/new-build-house-prices-west-midlands-17117686

[8] The Times (2025). Mortgage lenders and conveyancing solicitors are more cautious with leasehold properties. [online] Available at: https://www.thetimes.co.uk/article/mortgage-lenders-and-conveyancing-solicitors-are-more-cautious-with-leasehold-properties-8q5qv88hz

Plummeting construction costs in a specific region lead to a decrease of £43,000 in the average home price over the past year.