Negotiating on a new build - advice please

[Pweization]

So.......we have seen a (Bloor) house on a new estate in a nearby town. The house is one of the last 5 or 6 on the site, of maybe 100 homes and has just come back after its reservation fell through over lock down. There are a lot of new builds in the town, with more to come. We are very lucky that we do not have a mortgage on our current home, and have some savings, so for the right price, we wouldn’t need one. We are looking at the possibility of a PX - the full value of our house is £300k, and the new build Is up for £400k. We would need to make the difference between the 2 (Ie additional money we would need to pay) closer to £50k Question is, what sort of offer are the builders likely to take?
In our favour: it’s a stock house And I’m guessing if we moved quickly we could complete by the end of their FY (end June)
Against us: the unknown market, the price difference.
Is there anyone who works for a house builder, or who has had recent experience willing to give me a realistic expectation? What’s the best anyone else had negotiated?
Thanks

Be careful

m.facebook.com/pg/bloorhomesthetruth/posts/

That Facebook link about Blood homes sounds worrying!

Hmm... I had not heard of them before so just checked their CSS rating. They are classed as a 5 Star builder and I'm not convinced that rating is given lightly. I did quite a bit of research into that beforehand and it seems like a decent guide.

www.hbf.co.uk/policy/policy-and-wider-work-program/customer-satisfaction-survey/latest-results/

@Pweization - I think the unknown market might be in your favour. You might be able to negotiate a better deal if your home is in a good state. Remember new builds are sold at a premium so there might be wiggle room.

*Bloor not Blood!

We negotiated on our new build. It had fallen through previously and we asked for 10k off asking price and stamp duty. They accepted our offer as they wanted it gone. Came with lots of upgrades previous owner had asked for and floored throughout.

Be confident

Thanks @Neverending and @Choco. Both interesting reads. I hope you’re right Choco ☺️. A 25% reduction in price would be wonderful....but I think I may be being a tad unrealistic.

The fact you have a house to sell probably won't go in your favour. In our experience a lot of developers aren't accepting PX at the moment due to covid19.

If I were you I'd try and raise the mortgage without selling yours, present yourselves as free to purchase, negotiate the deal and then sell yours privately in the background to clear the mortgage.

Our first new build we had 25k off the price as it was the last one on the plot stamp duty and legal fees paid and came with flooring. We were first time buyers and it was 5years ago.with Barratt homes The second which was 2 years ago. Kitchen upgrade with quartz worktop worth 5k. Full estate agent fee paid stamp duty paid and 5k off asking price. With David Wilson homes. We nearly walked when we didn't get discounts wanted you have to be tough and go in at the right time. (Near the end of there financial year) reserch a few builders and see what they will offer. Some are better than others.
You have to be very strong and don't take the first offer. I have no experience with blood homes though im afraid.
Good luck

Bloor not blood

@grumpyorange wow!! That gives me hope. Thank you

The fact you have a house to sell probably won't go in your favour. In our experience a lot of developers aren't accepting PX at the moment due to covid19

Yes because they’re concerned the arse will fall out of the market. I’d take that as a worrying sign. Bargain hard

A lot of the rating are skewered unfortunately. Lots of new home owners are cajoled, sweetened up or harassed into ticking all the "right boxes".
Sites like Tust Pilot employ people to write fake reviews and get negative ones removed. TP are now beginning to take this a little more seriously as the CMA are investigating this issue.
Best way is to join the site above and engage with other Bloor owners.
Apart from building quality etc Ask about service charges, estate charges, ground rent terms, permission fees, length of lease if leasehold etc.
Above all - employ your own independent solicitors no matter what incentives/threats they use to persuade you to use on of their "recommended"solicitors. Very important.
Another important issue to check is will the estate be adopted by the council (most arent now!) If not, you will be expected to pay for roads, lighting, drains, open spaces etc on top of full council tax.
Don't take sales staff word for anything
Get everything in writing before committing.

@intheningnangnong you are spot on

@Neverending2020 is spot on. Our last house we used are own solicitors as the sales people lie through there teeth. Try to get freehold. And get dates for adoptions from the council.

Do they usually give you the full valuation price? I’d have thought they’d give you less in order to make more profit?

They will usually only pay up to a maximum % of the new house. Even if your house is worth more.

I got 10% off a new build recently (we've exchanged but not yet completed). Also got random extras that I needed/wanted - particular floorings, tiles, outside features etc

We didn't manage to get any of the asking price off, but we did get 5k of incentives included whereas none of the other houses on the estate had any at all (confirmed on estate WhatsApp group afterwards).

If they don't agree to as much of a reduction as you need try going down the incentives route instead as it may off set against what you'd need to pay out from your savings.

Thanks all for taking the time to answer. What is the best deal anyone has negotiated with one of the big housebuilders ? I know these are really uncertain times so normal rules don’t apply, but I’m interested to know what is achievable

@Pweization before we settled on this one we were also interested in a Barrats estate one. They wanted it gone ASAP so we're willing to drop from £345,000 to £315,000, pay stamp, legal fees etc. Came with upgraded kitchen, upgraded flooring etc. We would've had it but the garden was very sloped and there were already cars parked everywhere so would've been a fight to park

You are in a weak negotiation position because you have a house to sell - which means you are “not proceedable”. You will get a shocking price for a part x (that’s if they are even doing them now - doubt it) or the price will be OK but you won’t get a discount off the new build.

You can’t offer as a PP suggests and pretend you have the cash and then sell your house in the background - as “proof of funds” is needed to be confirmed by a sol.

We managed to get stamp duty paid and money towards legal fees as well as flooring and curtains last year. Also 5k off price. Apparently they are more likely to give incentives than large discounts as people can look up sold prices in future when looking to buy.We had sold STC when were negotiated though

For a part-ex, normally the builder would want a 30 per cent difference in the price of the houses, the new build being the more expensive one. So unless they are willing to back down on that part, it's going to be tricky to get it down to a £50k difference with the valuations you've quoted here.

Is the house already complete, is that why they will part-ex on it?

Good luck with the negotiations OP, I hope it goes well for you.

So I work with the sales dept of a house builder.
Bloor are generally thought as a good builder I think.

PX contrary to believe we rarely ever make money on a buy in. We shift them quickly as we are not in the business of selling 2nd band houses.

The company I work for get 2 independent valuations based on a 90 day sale and offer the average of the 2.
But as stated above the plot you are buying needs to be 30% higher.

If it is indeed Bloors year end then the scope to negotiate on will be good. I would expect a deal of around 5/7% of the purchase price.

The deal breaker will be if there are any other of that house type because if it's the last house of that type then they don't have to worry about comparable when it comes to valuing (they wouldn't want to devalue their own houses by offering a massive deal)

Generally it's much better to negotiate when you are proceedable. And don't have a house to sell.
Part exchange is expensive for us. Estate agents fee's, council tax whilst it's empty, stamp duty etc all of that has to be accounted for.
When we do part exchange that is normally the extend of the deal so nothing else. As I said, year end is different and frankly any thing is possible!

Bear in mind that Bloor are privately owned so the year-end may not be such a big deal for them as it would be for Taylor Wimpey, Barrett, etc who are listed.

PS I've had a Bloor home and no major issues.

Again, thank you 😊. The house is complete, and has previously Been reserved. There are 2 other of the same house type for sale (one finished, one not quite, and one other house left for sale. Interestingly 3 other houses of this type have sold in the last year or so - with a 10% difference (Decrease) in price between the first and last This is the second phase of the estate - probs 350 houses in total. Bloor are then moving out of town, so to speak. There are 5 other builders (to my knowledge) who are remaining. They have said they wouldn’t normally have looked at px - but nonetheless got me to fill in the paperwork and sent the EAs round. I’m expecting to hear from them in the next couple of days. Reading your wise words though, I think that sadly I’m living in cloud cuckoo land, and they will likely not entertain a low offer, even in these uncertain times :(. It’s a shame, but que sera I guess