Investing in a brand-new property can bring benefits like energy-efficient design, modern fittings, and low maintenance costs. This is attractive both for renters and for long-term value.

Advantages of investing in new-build properties:

• New-build units often feature up-to-date amenities, modern insulation, efficient heating, and higher energy performance, which reduces utility costs and attracts tenants who prefer contemporary homes.
• Maintenance and repair costs are generally lower in the beginning years; many new builds come with warranties covering structural defects and major issues.
• New-build properties are often in demand from renters. Their modern appearance and facilities make them easier to let, which helps reduce vacancy (void) periods.

Potential drawbacks and risks:

• New-build premium: new properties are frequently priced higher than comparable older properties. This initial premium can limit capital gain potential and increase risk if property values fall.
• Depreciation or value drop: once occupied, some new builds may lose part of their value; especially if local supply increases or developer offers continue, which can affect equity and exit strategy.
• Space and layout compromises: to maximize the number of units, some new developments may offer smaller rooms or compact layouts which may reduce long-term rental demand or resale appeal.

Summary:
Investing in a new-build can be a solid option for landlords seeking lower maintenance, energy efficiency, and high tenant demand. However, it’s essential to balance the benefits against the higher entry cost, potential value volatility, and layout limitations. Thorough due diligence and realistic expectations are key.

Some lenders apply stricter mortgage rules on new-builds, including lower maximum LTVs for new-build flats and higher deposit requirements in areas with many similar units. These restrictions can affect affordability and loan approval.