Whether a new build is worth paying more for depends far more on where you buy than on whether new builds are well made. Land Registry figures show a new build across the UK selling for roughly a third more than an existing home, but that national average hides a spread so wide it reverses. Over the twelve months to October 2025, weighted by the number of new build sales, the gap was 80.0% in the North East.
In London it was minus 9.9%, meaning new builds sold for less than second hand stock. The premium is above 25% in every other English region, and in London it is not a premium at all. Before you decide whether a new build is worth paying up for, you need to know which of those markets you are buying in.
In short
- The new build premium averages roughly a third across the UK, but ranges from minus 9.9% in London to 80.0% in the North East.
- The most recent months in the index are provisional and usually get revised downward.
- For a landlord, energy performance does more to justify the premium than comfort or snagging.
- The New Homes Ombudsman only covers you if you reserved on or after your developer’s registration start date.
- Run four numbers on the actual property: the local price gap, the EPC saving, the achievable rent and the real discount.
The premium depends on where you buy
Across the UK, the UK House Price Index put the average new build at £369,759 in May 2026 against £267,183 for an existing property, a difference of £102,576. Over the twelve months to May 2026 that gap ran in a band of roughly 27% to 38%.
Two warnings before anyone plans around those numbers, and they matter more than the numbers do.
- The first is that the most recent months are provisional. New build transactions reach the Land Registry late, so the index publishes an early estimate and revises it as registrations arrive. The revisions are not small and they run one way. June 2025 was first published at £380,120 and now stands at £339,283, a downward revision of about 11%. The most recent six months carry incomplete sales volumes and should be read as a first estimate rather than a settled figure.
- The second is that this is not a like for like comparison. The index measures the average new build sold against the average existing home sold, and those are different populations of property. Nobody publishes a clean matched pair figure for the UK.
The regional table is where that stops being a technicality. The twelve months to October 2025 are the most recent window where sales volumes have had time to largely settle, which is what makes a weighted comparison practical. More recent months are still being revised as further registrations arrive. Weight each month by new build sales volume across that window and the range is stark.
| English region | New build premium, 12 months to October 2025 |
|---|---|
| London | minus 9.9% |
| South West | 26.5% |
| South East | 27.1% |
| East of England | 28.5% |
| North West | 29.7% |
| West Midlands | 33.3% |
| Yorkshire and the Humber | 46.5% |
| East Midlands | 47.2% |
| North East | 80.0% |
A spread that wide across the English regions is itself evidence that much of the gap is what is being sold rather than a surcharge on identical bricks.
In London the average new build is cheaper than the average existing home, which most likely reflects a new build pipeline weighted towards flats against a resale market that includes far more houses. The index carries no property type split, so that explanation is a reasonable reading rather than something the data itself confirms.
The practical consequence is that a national figure is the wrong input. In the North East you are being asked to fund a very large gap and it needs a very good reason. In London the question barely arises.
Our note on where the returns are in 2026 covers the regional picture more widely.
Where a new build earns it back
The strongest argument for new build is not comfort or snagging. It is energy performance.
That matters in two ways a landlord can put a number on.
- Running costs fall on the tenant, which supports rent and shortens voids in a market where bills are part of the affordability conversation.
- The compliance exposure largely disappears. In January 2026 the government confirmed plans to raise the minimum energy efficiency standard for privately rented homes to EPC C or equivalent by 1 October 2030, although that still needs new legislation and the legal minimum today is E. A home already at A or B needs nothing spent to get there. An older property might need a five figure programme.
We set out the current status and the cost exposure in our guide to EPC C and what landlords will have to spend.
Maintenance is the smaller second argument. A new roof, boiler and windows will not need replacing during a normal hold, so the repair line is genuinely lighter for the first decade.
Do not overstate it. A newer property still carries service charges, and on many new estates an estate management charge sits on top for the upkeep of roads and open space a council has not adopted.
What the ombudsman does not cover
Buyers often price the consumer protection around new build as though it removes the risk of a bad developer. The more useful question is not how large the scheme is but whether it covers you at all, because that is not automatic.
The New Homes Ombudsman Service’s jurisdiction is not retrospective. A complaint is only eligible if the buyer reserved the property on or after that developer’s registration start date.
So cover depends on which developer you buy from and when they signed up, not on the age of the building or the price you pay. Check the developer is on the register before you reserve.
Treat the scheme as a route to redress on defined code breaches, not as insurance against a bad purchase. Read the warranty separately as well. The first two years of builder liability and years three to ten of structural cover are different things.
Run this test before you buy
The premium is worth paying when something specific pays it back. Work through four numbers on the actual property rather than on new build as a category.
- Price the local gap. Start with the gap on your deal, not the national one. Price the same rent in an older equivalent nearby and take the difference in purchase price. That figure is what you are being asked to fund, and as the regional table shows it may be far larger or far smaller than a third.
- Subtract the EPC cost. Then price the EPC work the older alternative would need to reach C, and subtract it. This is the calculation that most often rescues a new build for a landlord, because a second hand house at E with solid walls can carry a bill that eats a large part of the gap. If the older property is already at C or better, this line is close to zero and the new build case weakens sharply.
- Check the achievable rent. Then check the rent. Rents are set by location, size and condition, and a tenant rarely pays 80% more because a building is new. The uncomfortable part is where the two tables meet. The North East carries the widest premium at 80.0% and also has the lowest average private rent in England, at £788 a month in August 2026, against £2,332 in London where the premium disappears. The largest gap to fund sits with the smallest rent to fund it.
- Check what you are actually paying. Finally, ask what you are buying at. An off plan purchase, a bulk deal or an end of quarter incentive can take a meaningful slice off the asking price, and the argument changes when the premium is discounted rather than paid in full. Incentives that arrive as upgrades or paid fees are worth less than the same money off the price, because they do not reduce the figure you have to recover on resale.
What this means for property investors
Use your region’s number, not the national one. A third is an average of markets running from minus 10% to plus 80%, and no investor buys the average. The regional figure changes whether this is a marginal decision or an obvious no.
Buy new build for compliance and cost certainty, not for yield. Energy performance is the advantage most likely to move a model, and it is worth most where the alternative is an older property facing real upgrade spending. Where the alternative is already efficient, the case usually fails.
Do not treat the warranty or the ombudsman as risk transfer. Check the developer’s registration before reserving, and read what the warranty covers in its first two years against what it covers to year ten.
Underwrite the exit, not the entry. You pay the premium on completion and you sell into the second hand market, so model the sale as a second hand home. If the deal only works when you assume the premium survives to resale, it does not work.
To compare the two routes against real stock, you can see the investment property we currently have available and run these four numbers on a specific building. Our note on whether buy to let still works in 2026 covers the wider return picture.