Summary
New build incentives can make a headline sale price look stronger than the true market evidence. Buyers should adjust for disclosed incentives before using a new build sale as a comparable.
Definition
New build incentives are financial or non financial benefits offered by a developer or seller, such as cashback, deposit contributions, stamp duty contributions, upgraded fittings, furniture packs, part exchange support or other allowances. These incentives can distort a headline sold price because the recorded price may not reflect the net economic value of the transaction. The UK Finance Disclosure Form is used to disclose relevant information about newly built, converted or renovated property, including incentives. RICS guidance expects valuers to identify and account for incentives when analysing comparable evidence and valuing new build homes.