Buying a new build - confused by 10% exchange

[Candleabra]

The sale of my house is progressing (likely to complete mid march) and I'm thinking about a buying a new build. Apologies for what may seem a silly question.
But how do the finances work? The developer wants a £1000 deposit to reserve the plot, then 10% on exchange which must be 6 weeks from reserve date. This will be earlier than the completion date for my house sale.
I don't understand how anyone can buy a new build unless they're a cash buyer or have sold, and sitting in rented. Am I expected to find £50k to exchange before my sale completion and at least 8 months in advance of my purchase completion? And is the 10% completely non-refundable?

@Dinosauraddict that's such a big delay, what a nightmare for you . Are you in rented? I hope you complete before the SD deadline.

@bluepie that's hugely helpful thank you. We're going to see the development this week so forewarned is forearmed.
I'm not sure the new build is a goer unless they offer some big incentives, such as extras and SD. But depends on how much they want to sell the house. Can only ask!

Good luck with it all Candleabra

@Candleabra good luck! Go with a figure in mind exactly what you need, for us we needed stamp duty (was before holiday was announced), flooring included and when we found out wardrobes weren't standard (and beyond that stage) we said we needed a bit more to help us with that. We were very honest, said we'd accepted a lower offer on our house than we'd have liked due to the pandemic and we needed those incentives to buy, it had to go to "head office" but it was approved. Got all of the above and £3000 "removals" to actually cover wardrobes. (It helped it was just out of lockdown before the boom with the SD holiday, lots of unknowns, I suspect we wouldn't have done so well a couple months later).

It all depends on how well their houses are selling of course, but as we may be moving towards a slump and HTB is changing I suspect developers are going to need to negotiate more this year, so all you can do is try. Our house was not far off complete so if you aren't successful this time and go into rented, you might have more luck trying again in a couple months if sales aren't booming.

Good luck!

@bluepie they haven't mentioned stamp duty, but we were tied in before the latest changes, so all our coatings assumed we'd be paying it anyway. (I'd love to complete before the deadline though - would save us quite a bit of money).

@Candleabra yep it is a nightmare and I had my DS in Feb 2020 and thought we'd be all sorted by then. Now I'm back at work and he's nearly 1 - so very frustrating. At this rate I reckon he'll be able to walk into his new bedroom!

• costings, not coatings. Bloody autocorrect.

@Dinosauraddict oh gosh how frustrating, my fingers are crossed for you!! What a nice bonus that would be that would make up for the difficult time!

The thing I feel most guilty about is my poor mum's garage is full of furniture etc instead of paying for storage while this has dragged on

Oh I'm sure she doesn't mind, that's what parents are for! I used to store my stuff at my mum's when I moved and didn't have too and now she's downsized it's the other way around 😂

Haha no I don't think she minds really, but when she first agreed it wasn't supposed to be for this long!

Update: really loved the house. They wouldn't budge on sales price but offered a lot of incentives. I am very tempted. It's a great plot too, I was surprised by the garden size. Its held for me for 5 days until I have to reserve and pay a deposit.
And the 6 weeks to exchange will start from moment I pay the deposit....but apparently they'll be flexible if we can demonstrate progress blah blah.

My solicitor says the new build sales team are usually very pushy once the 6 week clock is ticking, but it should be ok, unless my house purchase falls through. No guarantees though, obviously.
Does this all sound pretty standard?

@Candleabra yep that all sounds very standard, by pushy he means they will threaten to pull out and incessantly contact you, your estate agent and even your buyer's solicitors if they find out who they are. It's very stressful, but for us it was worth it. What stage are you at with your sale? It would be worth speaking to your EA and just every nicely explain you're going to be under a lot of pressure to exchange within 6 weeks, they will know the deal, please explain this to the buyer's so they are proactive in getting all their paperwork in, we had a slow buyer and it was horrendous. But yes hopefully so long as you are continually moving forward they should stick with you.

Agreed, very standard. Glad you liked the house.