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2019 ANNUAL REPORT
2019
ANNUAL REPORT
Introduction 3
Executive Summary 4
The Home Buying Process 6
Moving In 7
Settling In 8
Warranty 9
Profile of Respondents 10
Detailed Findings 11
About the Survey 12
Contents
IntroductionThe New Homes Review (NHR) launched in November 2016. Its aim is to provide independent insight into the quality of new homes built for sale in the UK by taking a measure of the level of customer satisfaction amongst purchasers of new homes. In addition, NHR provides information to consumers and to developers, giving the latter valuable insight to help them improve service and delivery.
Key features of the NHR programme are:
• Itistrulyindependentandnotaffiliatedtodevelopersortoanindustrybody. New homeowners of any development can participate.
• The questions on the survey were developed following consultation with developers and consumers, to ensure that they are meaningful and relevant to both groups.
• New-build homeowners can choose how they complete the survey – online, over the telephone or via a postal survey.
NHR research is managed by independent research agency, Zebra Square Ltd.
Good service should be rewarded and NHR believes that excellence in home buildingshouldbenodifferent.Toprovideareliableguideforpotentialhomebuyers to encourage raising of building standards, NHR has developed an annual rating system based on customer satisfaction.
Ratings are shared with developers and builders registered with the participating warranty providers as a measure of customer satisfaction and to encourage them to provide a better new-home buying experience.
The ratings are calculated from responses to the following questions asked within the survey:
• The condition of the home when the customer moved in• Thestandardoffinishofthenewhome• The overall quality of the build• Value for money of the new home• Overall customer satisfaction• Overall satisfaction with the service provided throughout• Overall satisfaction with the service provided after the customer moved in
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Themajorityofnew-buildcustomersin2019weresatisfiedwiththeirhome,butaswith2018thereremainsroomforimprovement.Whilemostfeltthatthequalityofthebuildandthefinishwashigh,there was a slight fall in the number of customers believing that their new home represented good value for money. What remains clear is that new-home customers have very high expectations and with areas of the moving-in process falling short of those expectations, only around two-thirds of homeowners believe they get value for money.
How satisfied are new homebuyers?
TheNHRindependentratingforthenew-buildindustryfor2018isGold,withanoverallindustryratingof68%,aslightincreaseon2018(66%)andagainon2017(65%).Thescoreisrepresentedasapercentage.Themaximumpossiblescoreis100%,achievedifallrespondentsgaveascoreof10outof 10 for all satisfaction questions.
81 -100% Diamond
71 - 80% Platinum
61 - 70% Gold Overall industry rating: 68%
51 - 60% Silver
41 - 50% Bronze
Up to 40% Unrated
Other notable findings
There was a small increase in satisfaction across a number of measures in 2019 and a slight drop in the number of homeowners reporting snagging or defects when they moved in. The biggest improvement notedwasincustomerservicefromthedeveloperduringthesalesprocess(63%satisfactionin2019comparedto58%satisfactionin2018).
Fewerthantwo-thirdsofnewhomes(64%)werecompletedontime.Buildingnewhomesisacomplexprocess yet it remains a point of frustration for both customers and developers that the rate of late completionsremainsstubbornlyhigh(thenumberwas63%in2018).Itisalsodisappointingtonotethatalmostasmanyhomeownersweredissatisfiedwiththeservicefromtheirdeveloper(45%)assatisfied(55%)aftertheymovedin,thoughagainthisisasmallimprovementoverthe2018numbers.
Interestingly, the surveys asks respondents why they choose to buy new-build homes and the answers remainedidenticalto2018,withlocation,thedesignandlookofthepropertyandthepriceofthehomethe top three reasons.
Executive Summary
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The Home Buying ProcessThe housing crisis remains one of UK Government’s top priorities for 2020 and beyond and the building of new homes is considered critical to the UK’s health and economic prospects.
Buildersanddevelopers,includinghousingassociationsandlocal-authoritydevelopment arms, are pivotal if the country is to meet housing demand through affordable,qualityhomesthatpeoplewanttobuy.Allorganisationsbuildinghomesseek to improve the service they provide to customers, knowing that their commercial and/or ethical aspirations depend on their success in serving customers’ needs.
TheNHRsurveyshowedthat63%ofpeopleweresatisfiedwiththeservicethatwasprovidedthroughthesalesprocess,droppingto55%afterthecustomerhadmovedin. It continues to be the case that there is room for improvement here.
Therearemanydifferentreasonswhyhomebuyerschooseanewbuildproperty.Aspartofthisstudy,NHRlooksatthereasonswhypeoplechoseanewbuild.Thetopeightreasonsfor2018,rankedinorderofimportancewere:
1. Location2. The design and look of the property3. The price of the property4. The size of the property5. Closetofamilyandfriends6. Number of bedrooms7. Beingclosetowork8. Thereputationofthebuilder
Noneofthesepositionshavechangedfrom2018.Locationwasthemostimportantreason for the third year running, while (perhaps surprisingly) the reputation of the builder is least on new-home customers’ minds when choosing a new home.
Moving In Whenthebigmomentcomesandpeoplecrossthethresholdwiththekeysintheirhandsforthefirsttime,whataretheiroverallfirstimpressionsandexperiences?
Respondentsreportedthat64%ofnewhomeswerecompletedontime,asmallincreaseon2018(63%).
Was the build completed on time?
No: 36%
Yes: 64%
How satisfied are you with the condition of your home when you moved in?
How satisfied are you with the overall quality of the build?
7-8:27%
1 - 6: 34%
9 - 10: 39%
Breakdown of satisfaction scores
7-8:24%
1 - 6: 40%
9 - 10: 36%
Breakdown of satisfaction scores
How satisfied are you with the standard of finish of your new home?
How satisfied are you with your new home for value for money?
While69%ofbuyersbelievedtheirhometobevalue-for-moneyin2018,in2019thisratefellslightlyto67%.
7-8:31%
1 - 6: 33%
9 - 10: 36%
Breakdown of satisfaction scores
7-8:26%
1 - 6: 34%
9 - 10: 40%
Breakdown of satisfaction scores
The NHR survey asked new homeowners if the property was astheyhadexpectedwhentheymovedinand60%saidthatitwas,animprovementon2018’s56%.Aroundtwo-thirds(66%)ofrespondentsweresatisfiedwiththeoverallconditionof the property and the quality of the build, comparable to 2018(65%).Atotalof60%(59%in2018)weresatisfiedwiththestandardoffinish.
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Settling in Snaggingisarecurringissueforcustomersanddevelopersalike.In2019,89%ofthosesurveyedsaidthattheyhadexperiencedsnagsordefects,aslightinimprovementon2018(91%)and2017.
Did you experience any snags or defects when you moved in?
Anotherrecurringissuefordevelopersandbuildersisthelevelofservicecustomersreceiveoncetheyhavemovedin.Whiletheshareofcustomersthatratedithighlyin2019roseon2018(38%comparedwith33%),thenumbersofpeopledissatisfiedwithcustomerserviceremainshigh(45%),thoughthistoofellon2018’snumbers(49%).
This indicates builders and developers need to continue to work on the after-sales service, oftenhandledbythedeveloperorbuilder’sheadofficeratherthantheon-siteteam.
Overall, how satisfied or dissatisfied are you with the service provided by your builder after you have moved in?
No: 11%
Yes: 89%
7-8:17%
1 - 6: 45%
9 - 10: 38%
Breakdown of satisfaction scores
Warranty Astructuralwarrantyisaninsurancepolicydesignedtoprotectagainstdefectsinnewbuildings,normally for a period of 10 years after completion.
Given the survey responses that looked at the post sales service received, and the number of people that found themselves with some snags and defects, NHR went on to ask about the warranty or insurance that would cover major defects in a new-build home.
When asked about the importance of the warranty or insurance when choosing a new home, 86%ofthosesurveyedsaidthatitwasimportant.Equally,themajorityofrespondents(89%)reported some level of understanding of what is covered by their warranty.
How important was the warranty or insurance cover to you when buying your new home?
7-8:17%
1 - 6: 14%
9 - 10: 69%
Breakdown of satisfaction scores
Profile of RespondentsTheprofileofrespondentstakingpartinthe2019NHRsurveywasbroadlysimilartothepatternsseenin2018.
35-44:19%
45-54:18%
Under35:28%
2 people: 51%
3 people: 15%
1 person: 20%
No: 34%
No, but I have bought a home previously: 32%
Yes: 34%
65-74:14%
75+:4%
55-64:17%
5people:3%
6+people:1%
4 people: 10%
Which of the following age groups are you in?
Have you bought a new build home or newly converted home before this one?
Breakdown by age and household size:
Previous experience of buying a new build home:
How many people, including yourself, live in your home in total?
Detailed FindingsRanking of Drivers to Purchase
Order of drivers is based on the percentage of respondents naming each one as a reason to buy their new build home:
1 Location
2 The design and look of the property
3 The price of the property
4 The size of the property
5 Closetofamilyandfriends
6 Number of bedrooms
7 Beingclosetowork
8 The reputation of the builder
Comparison with 2018 and 2017
Percentage of respondents saying yes to each of these:
2017 2018 2019 +/-Buildbeingcompletedontime 59% 63% 64% +1% Improved
Experiencingsnagsordefects 93% 91% 89% -2% Improved
The property was as you expected it to be when you moved in
58% 56% 60% +4% Improved
Levels of satisfaction with…
2017 2018 2019 +/-The condition of your home when you moved in
59% 65% 66% +1% Improved
Thestandardoffinishofyournewhome 57% 59% 60% +1% Improved
The overall quality of the build 63% 65% 66% +1% Improved
Value for money of your new home 63% 69% 67% -2% Declined
Overall satisfaction with your new home 67% 69% 69.5% +0.5% Improved
Overall satisfaction with the service provided by your builder throughout the sales process
57% 58% 63% +5% Improved
Overall satisfaction with the service provided by your builder after you moved in
50% 51% 55% +4% Improved
Understanding of warranty %I fully understand what is covered by my new build warranty 36%
I know a little about what is covered by my new build warranty 53%
I am not at all aware of what is covered by my new build warranty 11%
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Purchasers of new-build homes registered for warranties with Premier Guarantee andLABCWarrantyareinvitedtoparticipateintheresearchwithin3monthsof moving into their property. Information is sent to these consumers via a postcardthatexplainstheprojectandhowtocompleteasurvey.Eachnewhomeaddress has a unique code to complete the survey online via the NHR website. Homeowners can request a telephone survey or a paper copy.
Who is eligible to take part?
Purchasers who have lived in their property for at least 2 months are eligible to take part.
The survey is not open to those renting a new build property.
New-build refers to any residential dwelling (house, apartment, bungalow etc).
Sample size
Between1November2018and31October2019,1,059homeownersparticipated.
Taking into account the number of postcards sent out, the sample size is robust, andwecanbe95%confidentintheresultswithin5%.Thesamplerepresentsthestandardconfidenceintervalandconfidencelevelinmarketresearch.
Report terminology
• Housebuilder, developer and builder refer to the party responsible for the build of the property.
• New build, property, dwelling and home refer to the respondent’s place of residence.
• Respondent, purchaser, consumer and owner refer to the individual who completed the survey.
Data
• Thebaseforallquestionsis1,059unlessthequestionwasaskedofa sub sample (e.g. homeowners who experienced defects). Statistics have been rounded to whole numbers.
• Lastyear,thesamplewas687.In2017–NHR’sfirstfullyear–thesample was536.
About the survey
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