PX with off plan property

[Southeastmamaof2]

HI All, we are currently looking into potentially buying an off plan property with DWH. We are so early, they haven't even started building that house yet but they are due to start with the last phase of the development in the next few months. We are also waiting for them to confirm the price.
Whilst waiting for my appointment we have been calculating and re-calculating what we can and can't afford. If the asking price goes as high as we fear it might go, we would only by able to afford that property IF the "fair value" for PX is the asking price (we know from estate agents and recent sales in the neighbourhood what our house is worth), stamp duty paid and flooring included. Does that sound like an achievable deal for PX on an off-plan property or should we face reality, not even ask and jog on? Anyone any experience?

You are very very unlikely to get those extras included with a PX, that goes for any developer. You need to have the funds available for if you don’t meet the stamp duty deadline. Sorry.

It might be. We got full Market value for px (Barratt homes who are part of David Wilson if I remember rightly), flooring and legal fees. The reason though was it was the last 3 flats left and they wanted off the site. Plus the sales woman seemed to want to screw them lol!

We bought off plan and got absolutely nothing from the developers, not that they were obliged to. We were buying in a popular area that hadn't had new builds in 20 years, so pretty sought after - developer knew this so didn't need to offer extras. When we threatened to walk away, the sales rep simply handed us the cancellation form, no convincing.

It's usually only near the end of a site development that you start seeing extras being offered because the developer wants to get offsite and leave it to the builders. They need to gauge the interest first.

I should also add - with any developer, if they seem to be willing to include lots of extras then it is worth having a look closer at that particular plot on the site plan, and why that might be.

Sometimes it can be related to proximity to the social housing quota that they have to include new developments (there are some very small minded people out there who are put off by this). But it does mean that they know eventually it will make the plot hard to sell so more likely to include incentives. Hopefully that is not something that would bother you but it is worth bearing in mind. Developers don’t include anything for free unless they absolutely have to!

yes that makes sense that they don't include anything unless they have to. Maybe the price is in our range, who knows - when I enquired they gave me a +/- 100k figure, which is obviously a lot of money...funnily some of the houses from the previous phase are still advertised from September 2020, but they just raised prices, so I am trying not to get my hopes up. also, @chloeb8, your comment about the stamp duty holiday makes sense. I would LOVE to complete before the STD holiday finishes, but the house won't be anywhere near ready. I was kinda hoping because we are early they might include an "early bird" discount, but I might just be dreaming that up. The plot we have our eyes on is amazing, so for sure no issue to re-sell this - unless interest in the development will drop in general after the stamp duty holiday finishes.

There are developers that include carpets, white goods, lighting etc as standard, but their initial prices are usually higher, although, when you take into account what you’d need to pay to put these things in yourselves, it’s not such a difference.

We calculated that one house we looked at would have to add at least £15,000 to the purchase price.

It all depends on numerous factors. We got exactly what we wanted for our px - they then sold our house at a loss. They paid all the selling fees, we got about 10k of extras thrown in after they reduced the house by 20k too. I think we got lucky as they are still building on our development and houses the same as ours are going 30k higher then we paid.

When we brought our new build (Davidsons - used to be part of DWH) we got a fair market price for our px, stamp duty paid and £2,500 for extras (I negotiated the last point and started at £5k, and this brought all our flooring) so it is possible, but we were the first house they sold on the development so I think it depends on where the site is in relation to completion.

Also, most companies have a max px value they can go to and you need to be increasing by to certain value too (on our site it's capped at £300k px value for your old home and your new home has to be at least 33% more expensive than the px price).

Good luck!