THE price of a new build has risen by 2.2 per cent over the past 12 months to reach a high of just under £200,000 per home.

According to analysis of 130 current developments of 2,500 homes throughout the country financed by Wolsey Securities, the first half of this year has seen an increase in the number of new home reservations, suggesting buyers’ confidence is growing.

During 2005, reservations levels remained steady but, after the usual seasonal slow down in December 2005, the first half of 2006 has shown a positive upturn in reservations.

The survey also showed evidence of a south to north ripple effect in market confidence, with the South East spearheading the activity across the country this year.

Reservation levels for released units increased from 18 per cent in June 2005 to 26 per cent in May 2006.

And if the South East is leading the revival across the country, it would suggest improvements should be anticipated in central England and Wales and the North and Scotland as the ripple effect spreads out across the rest of the country.

The number of apartments being built has increased from 54 per cent in January 2005 to 61 per cent this month while the average size per plot has decreased during the same period.

This echoes the Labour Government’s planning policy to increase the density of new build development, with more flats being built rather than detached homes – the proportion decreasing by almost a third from 22 per cent of Wolsey’s portfolio in January 2005 to 16 per cent in May 2006.

"The testing market conditions of 2005 are settling into a period of stability with signs of positive market activity reflected in the positive reservation levels," said Mike Ratcliffe, chief executive of Wolsey Securities.