Lidl to build homes costing just £64,000

Published on Monday 6 April 2009 21:42

BUDGET supermarket chain Lidl has teamed up with one of the UK's largest construction firms, to build what could be Scotland's cheapest new private homes.

The German chain and Taylor Wimpey will offer homes starting at around 64,000 for a one-bedroom flat.

Buyers will have their deposits and legal fees paid as part of the deal to get first-time buyers on to the property ladder.

The companies have submitted a joint planning application to East Lothian Council and are awaiting a decision on whether they can go ahead with their proposal to build 48 homes in Prestonpans, East Lothian.

The 64,000 one-bedroom flat costs about 32,600 less than an average one-bedroom flat in East Lothian, while the two-bed flat at around 70,000 is nearly 50,000 less than the average for the area – and 95,000 less than a two-bed flat in Edinburgh.

The plan has been drawn up between Lidl – which owns the development land in the town's high street – and Taylor Wimpey's "no frills" housing brand, G2. G2 homes are studio-type dwellings. It is understood the properties would only be available to first-time buyers, with buy-to-let investors barred.

The project suffered a setback in its early stages after concerns were raised locally about the demolition of a building on the site, but a spokesman for East Lothian Council said Historic Scotland has decided that it does not need to become a listed building.

A council spokesman said: "The council would welcome housing that is affordable and allows first-time buyers especially to get on the ladder."

A spokesman for Taylor Wimpey said: "G2 is Taylor Wimpey's brand of affordable, low-cost homes designed specifically for first-time buyers."

Last night, housing experts said it was too early to say whether the Prestonpans development represented a new trend in affordable housing.

David Marshall, a business analyst at the Edinburgh Solicitors' Property Centre, said: "The number of new-builds has fallen by 80 per cent since the start of the credit crunch and builders have been looking to shift their own stock before building more.

"This Prestonpans project is a relatively new thing and is a way of filling the void. Ultimately, we will only see more of this if the supermarkets find it profitable."

Alex Hawkes, news editor of Construction News, said: "Quite a lot of supermarkets build housing alongside their stores and these types of new homes we're talking about can be copied.

"In terms of this being a new trend, the housebuilding business model is such that builders tend to make their money on land values going up rather than how, to whom, and where homes are pitched. But housebuilders are suffering badly with falling property prices and are all thinking about whether they should be building again."