_Buyers increasingly looking for best-in-class product not just specific postcodes

Residential developments are showing huge discrepancies in values based on quality – take Nine Elms as an example, where the spread in value across a small area ranges between £1,100/sq ft, up to £2,000.

There is, of course, some variation in location across the wider area, but equally, some of the developments just don’t stand out from the crowd and therefore don’t achieve the premium values.

Developments that are designed through researching competing schemes and ‘averaging’ the standards, end up with an ‘average’ product.

And ‘average’ isn’t good enough anymore.

Buyers today are increasingly looking for best-in-class product, crucially where they see value, not just a specific area or postcode. As the market becomes ever more product-led, the importance of getting the unit mix, apartment configuration and quality right has never been more relevant.

The best performing developments follow a clear methodology, combining good ceiling heights, quality specification and a considered approach into how individuals use the wider building and its amenities.

Developments that deliver innovatively designed apartments with 24 hour, hotel standard servicing and a suite of residents’ amenities are even pushing the geographical boundaries of traditionally desirable residential addresses and consequently the ‘new build premium’ in some of these locations can be considerable.

This is particularly the case where the development has significant scale and delivers a mixture of uses, including retail, which directly supplement the lives of the residents within a secure and safe environment. This way, purchasers can trail the ‘Hipsters’ into new territories whilst maintaining their comfort and convenience.

^{Above: Abigail Heyworth}

So what is the attraction of purchasing a new build home? Is it having your home carefully designed by a professional interior designer? Designed to reflect the needs of how people live now, rather than the compromised layouts of narrow period houses?

Is it having high quality sound and heat insulation, rather than lying awake listening to your neighbour’s TV all night, protected from the harsh British winter by just a single pane of poorly fitted glass? 

Is it the high levels of security, coupled with the convenience of having a concierge available to collect and sign for those Amazon deliveries? The list continues; onsite gym, pool, cinema, parking, storage, private dining rooms and lounges… 

OK, admittedly, it might not have the appearance and charm of a period home, but high quality architecture and landscaping must appease this to some extent.

Floor to ceiling heights are ever increasing and 2.6m is considered standard now. Specification has improved significantly and economies of scale mean that, for the price point, apartments benefit from a higher standard than one off purchasers would be able to achieve.  

A recent report published by Knight Frank, Core Five and MSMR (which undertook a survey of purchasers of prime new build homes in London) found that 55% consider that good specification is important and adds value with 8% even feeling that it is the most important factor when purchasing a home, even more so than location.

So when all this ‘quality’ is offered, but the location isn’t quite perfect; maybe one stop further on the tube, or just on the other side of the Thames, or just outside that ever desirable postcode, would you buy there? Many people would.

And so we see the ripple effect of value being led into new locations by the ‘quality, quality, quality’ of new build development. 

Abigail Heyworth is a Partner in Knight Frank’s Residential Development Consultancy team, advising developers throughout the entire process of land assembly, scheme design and through to marketing the final homes. 

Abigail Heyworth is a Partner in Knight Frank's Residential Development Consultancy.