Housebuilder Redrow this week secured 90% reservations from first-time buyers for its range of cheap houses, which have a starting price of £55,000.
Last weekend more than 200 members of the public in Rugby, Warwickshire, queued to reserve one of the 103 ‘Debut’ homes, the cheapest of which is £55,000. The price of the homes included the cost of land. Redrow retains £5000 of shared equity.
Redrow secured the high number of reservations despite buy-to-let investors being barred from buying the homes.
Paul Pedley, Redrow’s chief executive, said: “When people talk about the housing market being flat on its back, you have got to remember that it is made up of lots of different markets. When you build the right product at the right price, you will sell houses,” he said.
Pedley said that, despite the low house prices, Redrow could achieve the same margins as it did on traditional housing because of the use of modern methods of construction, which sped up building timescales, thereby reducing costs.
The homes for sale at Rugby ranged from one-bedroom apartments to two-bedroom homes priced up to £109,995.
Redrow has secured planning permission to build 71 similar homes in Chorley, Lancashire, and has submitted a planning application at Castle Vale in Birmingham.
“This thing has legs,” said Pedley. “How big it gets depends on how much political will there is.”