- Berkeley Group is offering up to £41,760 in private school fees to buyers at one of its London developments.
- Developers are increasingly using incentives such as electric cars, stamp duty support and free service charges to boost sales.
- London's house prices fell 3.7 per cent in the year to May, despite growth across England.
Buying a new home in London could now come with more than just a set of keys.
Private school fees have become the latest incentive being used by developers to attract buyers, as London's property market continues to lag behind much of the rest of England. The offer reflects a wider trend in which housebuilders are becoming increasingly creative to persuade buyers facing higher borrowing costs.
At Berkeley Group's Trent Park development in north London, buyers can receive up to £41,760 towards two years of tuition at St John's Preparatory and Senior School. The incentive applies to families purchasing homes at the development, where prices start from £760,000 and rise to £1.85 million for larger properties.
Perks are replacing price cuts
The school fee offer is one of a growing number of incentives appearing across the new-build housing market.
Rather than relying solely on price reductions, developers are increasingly offering to cover stamp duty, mortgage payments, deposits, legal fees, council tax or service charges for a limited period. Some have gone even further.
Brighton-based developer You Are Home, for example, previously offered buyers of £1.65 million townhouses a Polestar 2 electric car worth almost £44,000 if they paid the full asking price. Other incentives have included electric bicycles, upgraded interiors and complimentary consultations with interior designers.
Although housebuilders have reduced asking prices by an average of 8 per cent, discounts and incentives on some developments are reportedly reaching 30 per cent, highlighting the pressure many are facing to maintain sales.
A tougher market in London
Developers are turning to these offers as London's housing market continues to underperform.
According to the Office for National Statistics, average house prices in the capital fell 3.7 per cent in the year to May, marking the ninth consecutive month of annual decline. Inner London recorded a 5.9 per cent fall, while prices in outer London slipped 0.3 per cent.
Across England, however, average house prices increased 2.3 per cent over the same period, underlining the capital's weaker performance.
Higher borrowing costs have reduced what many buyers can afford, particularly in London's higher-priced market. That has prompted developers to offer additional incentives instead of relying only on price cuts.
The slowdown also comes as the government faces pressure to increase housing supply. Deputy Prime Minister Angela Rayner reportedly acknowledged that delivering the target of 1.5 million new homes would be "a really difficult stretch", adding to concerns over the pace of housebuilding.
As the market remains subdued, incentives once seen as unusual, from free private school fees to electric cars, are increasingly becoming part of the sales pitch for new homes.
