Housebuilders need to start looking outside of the first time buyers market to drive sales.
Help to Buy has proved a huge boon for housebuilders, supporting first time buyers into the home ownership market by enabling them to secure the often impossible deposit. With over 40% of new homes sales being driven through Help to Buy the industry is looking ahead to where Help to Buy goes next.
To maintain profitability in the future, and ensure demand for new build property remains high, housebuilders need to look outside the first time buyer market to drive sales.
However this is not as straightforward as targeting existing home owners; the impact of economic uncertainty on the property market has meant that people are putting off moving unless necessary, with second and third time movers having the lowest share of all housing sales for a decade.
To maintain current development prices, and profits, housebuilders need to look at ways of enticing existing property owners in to new homes to help keep up demand. This is particularly important in southern England, where property sales are down and affordability pressures are at their highest.
Looking at other options
As the housing market cools, many housebuilders are ramping up part exchange and ‘assisted move’ incentives to help encourage property owners to move. By doing so they will help stimulate sticky market points and meet sales targets. But how can these schemes be made more appealing, with messages that resonate with second and third time movers?
Enticing existing homeowners
Housebuilders need to challenge misconceptions about the expensive nature of buying new, by showcasing the potential value an existing homeowner can use to offset the cost of their new home, through part exchange. Highlighting the simplicity of the moving process, and the benefits of buying new, can help steer early interest.
Hometrack, a part of ZPG, has developed lead generation solutions which housebuilders can use to provide a steady pipeline of new enquiries, through offering homeowners an accurate valuation of their existing property for part exchange purposes. This draws on valuation data used by 12 out of 15 of the top UK mortgage lenders. Combined with a specialist retargeting marketing solution, such as AdReach, can intelligently build awareness of your developments and brand to your target audience at the right time.
Supplemented with a dual-branded Hometrack valuation report provides a powerful impetus to drive sales conversions, and help existing property owners along the buying new funnel. Plus providing market leading and independent valuation data at no cost to the consumers, makes for a good brand experience for potential customers.
And if they don’t qualify for part exchange, an accurate understanding of how much capital could be raised from selling their existing property helps provide a powerful impetus to move. Supported with messaging promoting the benefits of new properties over resale will help to get existing homeowners moving and upgrading their properties.
Hannah Parker, business development manager for residential real estate solutions at Hometrack. Hometrack provides property market insights for critical decision making, and work with six out of 10 of the largest UK housebuilders.