The proportion of new homes sold off-plan in England and Wales has fallen to its lowest level since 2013 according to new research from Hamptons.
Just 33% of new homes were sold before construction completed in 2025, down from 36% in 2024 and well below the 49% peak recorded in 2016.
The decline has been most pronounced across southern England, with London, the South West and South East all seeing off-plan sales rates fall by around 20 percentage points or more over the past decade.
Hamptons said the slowdown has been driven by the retreat of buy-to-let investors from the market following successive increases in stamp duty surcharges and higher borrowing costs.
HARDEST HIT
Flats, which have traditionally dominated off-plan purchases, have been hardest hit. While 55% of flats sold in 2025 were bought before completion, the overall share has dropped sharply over the last decade as developers increasingly shift away from high-density apartment schemes towards suburban housing developments.
Flats accounted for just 22% of all new homes sold in 2025, compared to 38% in 2016 and 54% in 2007.
The changing sales profile is also pushing up costs for housebuilders. Hamptons estimates that fewer off-plan sales, combined with higher interest rates, added £264.5m in additional financing costs to developers last year compared to a decade ago.
That equates to an additional £3,125 per new home sold in 2025.
The North West remained the strongest market for off-plan apartment sales, with 69% of flats sold before completion, ahead of London at 65%.
DOWNWARD TREND
David Fell (main picture, inset)), Lead Analyst at Hamptons, says: “The share of new homes sold off-plan continued to slide last year.
“Over the past decade, the share of new homes sold before construction is complete has fallen by around a third.
“This partly reflects the loss of buy-to-let investors from the market, who have traditionally been the largest buyers of off-plan homes.
“However, the shift away from building flats towards houses, which are more likely to be sold after they’re finished and ready to move into, has increasingly contributed to the downward trend.”
HOUSING DELIVERY
He adds: “This move towards lower-density, house-led development is likely to make it harder for the government to significantly ramp up housing delivery.
“Housebuilders are increasingly focused on protecting margins, which has favoured faster-selling suburban schemes. By contrast, profits on slower-selling, high-density sites have been eroded, or in some cases, wiped out entirely by rising finance costs.
“In a higher inflation, higher interest rate world, off-plan sales have rarely been more valuable.
“The cash they generate allows housebuilders to pay down expensive development finance earlier and help offset the substantial upfront costs of materials and labour.
“Many of the materials needed to build new homes are highly energy-intensive, meaning their costs have risen far faster than wider inflation.”
