Buying off plan - advice please

[Snowdrop18]

hello all
we are thinking to put the reservation fee down on a new build we've seen

I was wondering if anyone has experience of negotiating the price down on new builds. Also I was wondering if anyone has ever actually moved into their new build on time - I've only ever heard horror stories.

Any advice on buying off plan would be much appreciated - it's really a weird kind of experience. I'm half wondering if we should delay putting ours on the market but we can't move unless we sell ours. Theoretical completion date for the new build is April but I've known people be delayed a couple of months or more.

We didn't negotiate on price but got carpets thrown in for free.

Ours was ready earlier than they originally said which was ok for us as we were moving from rented into our first home but might be annoying for you.

We had to exchange a month after putting down the reservation fee and then wait 6 months to complete - again not a problem for us as we had our deposit as first time buyers but was a bit scary to wait the 6 months knowing we were legally liable for the whole purchase!

My friend who is a property lawyer ty old me that she would never buy off plan. She has seen too many problems. Be very careful.

DD bought off plan and it was a shambles with delay to completion and major snagging which seemed to take for ever to get sorted. The whole area waited over 5 months to get internet and phone sorted and had to live off mobiles and mobile data. That was 10 years ago so things may have improved but from what I see of the industry it's not great. You also need to be very careful that you have free hold and not leasehold because that is the latest nightmare. Also consider whether the streets and green spaces will be adopted by the local council or if they will go to a management company who can charge what they like to keep the area in good order

We did, although it was years ago
Even part exchanged and got a good price. Whole process was easy and worked well for us.
Any minor snags were sorted very quickly by the site manager

thanks for all these points

I hadn't considered local roads at all - it is that kind of situation, all a building site at the moment

I'm a bit unclear why a leasehold house is a nightmare though?

Leasehold means that you will always have service charges to pay and, depending on how the contract is written, they can increase many for over the years. This will make it difficult to sell the house in the future too.

thanks Mosaic

I'm aware of the service charges as it's on a development but I was just wondering why it was considered a problem apart from that, if you see what I mean. We're in a leasehold flat at the moment.

www.theguardian.com/money/2017/jul/25/leasehold-houses-and-the-ground-rent-scandal-all-you-need-to-know

This seems to explain it quite well.

From the experience of others & myself, you're more re likely to be able to negotiate on the extras rather than actual selling price. E.g upgrade on fixtures & fittings, getting the garden turfed etc

I bought "new", but from a private developer who had bought off plan. So was too late to choose kitchen & bathroom etc. Made the mistake of assuming it'd be the same as next-door! So be clear on what F&F are, particularly when choosing furniture / decor to match.

Agree with PP, understand what the deal is on adoption of roads by council. It's often once they're at a suitable standard - which may be some time depending on scale of the new estate. This can then impact on council services providing, e.g. snow / ice clearing (although after this winter many in my area would argue the council didn't provide this to anyone !)

Check out any planning permission deals done. My developer "sold off" permitted development rights for my street, presumably in return for something. It's meant I've needed planning permission for something that technically would be allowable under PD ..... had to apply for PP, but at zero cost.

Suppose it's the same for any house, but check for any unusual title deed restrictions. We're not supposed to store caravans, campervans or horse boxes in the driveway. We're not supposed to run a business from home. Nor are we supposed to have any kind of hedges or fences on front garden!!
The business part, no-one seems to object if you're a sole trader accountant or similar, but there was excitement when someone advertised beauty salon services from her spare bedroom!

Thank you Mosaic and Dr Quinn, that's really helpful

Leasehold houses are quickly becoming quite a scandal. Your lease could begin at £50 per year but often leases are written that they up to double per year so your next lease is possibly £100, then £200, then £400 etc and before you know it you’re paying £1000s a year. And who is going to buy that from you? We bought off plan 13 years ago and ours is freehold. My suggestion would be look at freehold homes only.

I would only buy (and have only bought) new build houses off plan, that way you usually get a choice in the finish. I wouldn’t be interested in the vanilla choices picked by the sales team. It’s usual to have to wait up to 6 months to move in even though you will need to exchange 4-6 weeks after reservation. If you’ve set your heart on a new build don’t let this put you off

Have never had a discount off the price but incentives thrown in - how much depends on how well the development is selling

Thanks for this information, that's really helpful

given the timeframes for buying the new builds, I have another question which might be better on the money section but those posting here might know?

This would be a long distance move and I'm worried about co-ordinating a long distance move - I mean I know it's rare for things to go wrong after exchanging on both but the idea of sitting around with all our stuff waiting to go a long way, on completion date, fills me with horror. I wondered if anyone has experience of bridging loans? The other thing we could do is take out a let to buy mortgage and just let the place for six months and then sell after.

any thoughts?

thanks.

I would discuss all this with your solicitor. Do you know anyone who understands company accounts? Get them to look at any financial information available on the company building the properties to make sure they are doing well. You dont want to give your money to banks dodgy developer.

Sorry. Ignore the last 'banks' word.

We've just bought offplan and the whole think was fairly smooth sailing. We bought when the development was half finished, so about another 100 or so houses left to build. Roads still need to be finished, but that doesn't really cause an issue. No street signs, but lampposts are in. Roads won't get cleared due to snow... but I wouldn't expect them to.

We didn't have phone lines etc, but phone company get it all sorted in about 10 days. We had wiring to the house, but not connected to the property.

You may not be able to get a discount, I think something to do with they need the houses to sell at a specific price to guarantee the value of the other properties ... or something... you CAN get the fixture and fixings upgraded for free. Don't be scared to haggle. Ask for everything. You never know ;).

We got to pick all the fixtures and fittings, but the neighbour didn't as the developer needed the order in, but the plot wasn't reserved, so depending on what stage your property is at, you may not get to choose.

Freehold can be an issue if you want to remortgage or sell in 20/30 years. If you getting to the end of a leasehold, mortgage lenders won't lend. Some developers will give you the option to buy the freehold. My friend did this on her property and paid about 6k for a house values at 200k

We had a vague completion date until about 6 weeks before the house was due for completion then we were given a firm date. We got the keys the day we should have. Completion went through on the same day.

Thanks for all this, really helpful
It looks as if a bridging loan is a terrible idea and the new builds do all seem vague about their completion dates so might need to stop and rethink stages on this.