Experiences of buying new build flat

[ouch321]

(Tried on Chat, but no responses so pls excuse double post)

Just wondering if anyone had any wisdom to share...

Have a one bed but lack storage. Very vaguely thinking about moving to a nice new two bed for a bit more room.

Single, no kids and that is v unlikely to ever change so I do not have to think about a garden though I would like a balcony.

So just wondering if you have bought a new flat how it was, any tips etc etc.

I moved into a new build, a 1 bed maisonette. As a tradesman who has worked on plenty of new build sites, I know they aren't necessarily always built the best (get a showhome/ ex showhome if possible) as they are usually best built. But of course you get good ones with hardly any issues (luckily I did) or you can get nightmare builds with snag lists as long as your arms. So look into the home builders first. And if possible when viewing if you have any friends in the trades to come along and look with you is handy!

Besides from the builds themselves I found it could be difficult for your average Joe diyer to make many changes to personalise and make more homely with things like hollow and non load bearing walls, very little room to change out things like units, bathroom, furnishings unless you go like for like. With the walls also being thing and not the best, you often get alot of noise traveling between flats etc.

Money wise where I lived seemed good value for money when compared to older similar properties. However there was lots of fees, which in my case added up to around £3000 a year with ground rent, 3 maintenance companies (which were hard to get to do anything) and a company which we paid to look after the greens, parks and ponds and never saw for 2 years. Which worked an extra £250-£300 a month ontop of the mortgage and bills.

The last downside I would say was the parking and street/road layout, with thin roads and pavements which usually had cars park half on the paths, grass or blocking drives, luckily I had 1 allocated space in the car park behind, unluckily if you have an average sized car or above you'd be lucky to comfortably park and access your car if your neighbours were also parked up.

But on the plus side it seemed to be a nice community with varying classes of people, ages and races. Not much worry about repairs to your flat etc as all is new. Was always a nice area to walk, take the dog out to the fields, usually plenty of parks and communal areas etc.

I wouldn't be against a new build in the future however I would avoid a new build flat or maisonette and would go for a house instead.

Sorry for such a long post, was just trying to cover all aspects

Thank you

Newbuilds do tend to be overpriced. Why brand new in particular?

We bought a new build flat in 2017. There have been some issues.

1. See if you can paint when you move in, if it's not settled enough you'll have to wait and then you'll have to paint around your furniture. The paint that's on there will rub off when you try and remove a mark.

1. Get the builders details if possible. We've had a pneumatic door break, about four cupboard doors fall off, the fridge break and the skirting boards split. Oh and the roof has leaked twice and our lights blink.

1. They try and get a nice finish to sell but it is done cheaply. Prepare to add things like more bathroom cupboards.

1. Despite all that it's a lovely home and I don't regret buying it. Oddly.

It wasn't cheap (around £620k) so I was surprised by all the faults.

Oddly our house is insanely sound proof. Which we didn't expect

New Builds come with uncapped and unregulated service charges. They are monitised by large investment companies and corporations who use your home as a steady income stream.
Do not believe what the sales office spin you.
Ask for tp contractual documents before laying out a penny. This will tell you the full long term financial obligations they are locking you into e.g. onerous ground rent terms, estate charges, service charges, permission fees, costly lease extensions (If leasehold). If the council don't adopt the estate (most aren't now) you will be footing the cost for anything from roads, lighting, drainage, playgrounds, car parks etc as well as paying full council tax.
Never use their "recommended" solicitor. Get your own independent, leasehold solicitor to scrutinise all legal documents with a fine tooth comb.

Many buyers may want to look at the new build draft Lease to find out about the percentage of service charges and escalating ground rent they would be responsible for. When they find that the terms of the lease are not particularly great, they may then ask their solicitor to make "amendments" to the draft Lease. Please bear in mind that new build draft Leases are not usually amended because a potential buyer doesn't like some of the clauses. The Lease will be the same for every apartment in the block and developers will not amend a Lease for one person. If the terms are so onerous that it will be difficult to obtain a mortgage, then the developer may need to consider amendments, but as a buyer, you have to accept it as is, or buy something else. So make sure you know all the costs you would be responsible for, not only when purchasing but also for the future saleability of the property. If you do not understand some of the clauses, ask your solicitor to explain in layman's terms.

@Neverending2020 the permission fees can't be known for certain until you ask for permission. And why would a new build lease need a lease extension?

I was just coming on to post the same as @Neverending2020. @MinnieMountain if you're unlucky enough to have a 100 year lease you'll need an extension in the next 18-19 years in order to avoid marriage value.

About 10 years ago we had a newbuild 2 bed flat. It was great, the bill's were extremely low, kitchen and bathroom were fresh and modern, we had some big storage cupboards...It was lovely, we only moved for work reasons really. Just make sure you have your own allocated parking/carport/garage and also check out the ground rent fees so that you can budget for them.

I know it's something to be considered after a while @TooSadToSay but it's impossible to say how much that would cost at the point of buying a new build.

@MinnieMountain

I suppose be cause it's unblemished. My current flat is not that old in the grand scheme of things but for example the previous occupants damaged the sink and it's all scratched up, the heated towel rail was damaged, there are holes in the walls where they put up rails. that kind of thing. Nothing major but it would be nice to start from afresh.

@CorianderLord

I think I'd be more than a little annoyed if all the cupboards started to fall apart.

Saying that I have heard that some firms have a better reputation than others for the quality of their builds. Eg I heard Taylor Wimpey bashed a lot over the years.

My ground rent is 250 a year and service charge 1500.

I know that's not too bad and it'll be higher for a 2 bed and higher again for a new build.

It's the management fees that would worry me - they may well remain at a reasonable price but they could go up a lot.

ouch321 check whether the ground rent will double every 20 years as an example. You need to know when it increases and by how much. This will be in the lease. What does the service charge include?

Service charges generally aren't as scary as people make out. Especially how as if you buy through a reputable solicitor they will check the terms quite carefully for you. As long as you check, it wouldn't stop me going ahead.

I generally avoid leasehold because I don't trust them. The ground rent and service charges are unregulated, as far as I know.

If it is a brand new flat then there should be a sink fund to cover any extra costs for about 10 years or so. Check with a solicitor.

If I were you, I would look for a freehold house or share of a freehold flat (they tend to be renovated older properties).

The point is that the law is flawed around LH, leaving LHs open to unfair or unscrupulous practices.

There are situations where LH have right to manage and it's all good. But that's not really clear looking at a flat on Rightmove, for example. You really need to find that out about the lease up front though and find an excellent conveyancer who can really interrogate it and explain it fully to you.

There's no shortage of examples in the press where LHs are being price gouged or left responsible for bills their service charges should really be covering, while management companies take mega fees. LHs are being charged the full cost of replacing dangerous cladding, for example. And the crazy cost of extra fire wardens.

Yes, I read this about cladding.

Parking. If there is private parking some freeholders are appointing parking management companies to "manage" parking. What this means is they force you to apply for a permit to park in your own space, and then issue you with a parking charge if the permit happens to not be visible for whatever reason (draw your own conclusion).

What is happening now is these are being challenged at court as the companies cannot over ride your lease, but they ignore each court loss and carry in as most people can be bothered and just pay up the £100 each time at threat of a CCJ.

As someone else said, it is about monetising the value of the freehold, so overcharging for services, appointing parking companies etc all derives an income stream. Far better with freeholds owned by the leaseholders and held as a limited company which you run yourself.

Oh..check who the freeholder is. A friend just bought a lovely flat but the purchase was a nightmare. The freeholder was a company based offshore in a tax haven. Nightmare to respond and challenging charges a nightmare.

Future charges are important to look at, even if you only plan to stay for 3-5 years. The closer you get to the higher charges, the more prospective buyers are put off.

So most people want to renew a lease before it gets to 80 years as that's when the cost increases hugely. So 10 years on from a 99 year lease starting, a prospective buyer is thinking that when THEY come to sell they will need to renew or accept a lower price. It's about the impact on putting properties buyers further down the line off, that all these escalating charges are particularly problematic.

If possible, go for a flat that isn't brand new and isn't in on an estate,must a standard road. You won't have all the managing the paths and green spaces fees. A nd you won't pay the premium for new build or face the problems of snagging and the non-weight bearing walls etc if you pick something that is more than 20 years old.

Don't be blinded by the shiny new aspect of the new build. Don't be blinded by fears of costs of older properties. Shiny new often looks shabby within a couple of years and the costs people have to pay on older properties are often exaggerated or play on fears of those without many savings. Not many people have to pay for a new roof. Lots of people pay very costly estate charges.

If you can avoid Help to Buy etc which might tie you into new builds then do. You can often get property nearby that isn't new and a bit smaller for the money you can afford outright. It's so worth it - those who've had to remortgage several times with their help to buys which had inflated starting prices will tel you this.

Lots of good advice and warnings.
@MinnieMountain
Lots of people aren't aware of permission fees. It is one of numerous things charged in the monetising of your home e.g. £60 to change a doorbell, £250 to change from carpets to wooden floors, or have a pet, or build a shed.. or change mortgage providers...list is endless.. and should you want to build an extension around £2500 "permission" fee is normal. This is just one issue that you are not told about.
Some new builds come with 125 year lease. As the years go by, the lease decreases thus the value of the property decreases. That's why there has been outrage at many new build houses being sold as leasehold.

I am well aware of all of that @Neverending2020 What I meant was that by all means be aware, but it is not possible to say what the costs will be in 5 years time when you need permission/an extension.

@MinnieMountain Well that's even more reason to worry...like leaving your wallet open for them to help themselves to as much as they want, knowing if you desperately want said shed/pet/change mortgage provider you have no choice but to pay the permission fee.
There will already be a list of fees which ought to be given to you when first seriously showing interest in buying the property, in the name of upfront transparency. It won't be. Permission fees won't even be mentioned, let alone a potential buyer given the permission fee price list.

If you then decide in 5 years time to build a shed in the garden of your own house I doubt very much that the permission fee for this will have gone down in cost