What would a cheeky offer be on a new build?

[dandeliondaisy]

We are considering a new build house for our next purchase, however we cannot afford the asking price which seems very expensive. We are in London so property is generally extortionate, and we are realistic with what we can afford. Stupidly, I've got it into my head that we could somehow afford one of these lovely new build properties. Does anyone have an idea of what % under asking price we could offer without being laughed out the room ? Thanks so much for your assistance. We are clueless!

Realistically, few developers will take offers. They'll be happy to add extras so long as the base price isn't eroded.

Your best bet would be to offer around the end of a quarter or financial year, as that is when their bonuses get calculated.

The price was non negotiable when I last bought a new build. Thought that was standard practice.

My understanding is that new build developers rarely accept price reductions, instead they throw in incentives.

Private sellers of older properties are generally much more open to offers re price reductions.

Oh no, not looking good. They've said we can have stamp duty off but that's not enough. Very helpful advice anyway. Thank you

I've never known a new build to take an offer below the price. They will often throw in some incentives though. If it was a small local builder you'd have more chance. The strategy generally adopted is to raise the fixed price the more interest they get. People will sit and dither and watch the prices without jumping in so adding a couple £k to the price tends to force people's hand to reserve a plot.

You could try a well timed conversation asking "if I was to reserve a property today. What is the best deal you can offer me?"

You won’t be able to negotiate the price of a new build but you might be able to get stamp duty/flooring/upgrades paid.

We got 7% off and free (crappy) flooring and that was during Covid’s house buying manic period. they do offer discounts but is done via offering cash towards your deposit - so the selling price isn’t recorded as lower which might potentially hurt future sales on a large development.

My parents got a more substantial discount but it was with a high end / small developer and the last house to go - so they wanted to be off site and on to the next development.
So no, you won’t be laughed out, it’s just business and if they say no then you have lost nothing but time by asking.

Everyone told me to negotiate around the end of the financial year… they basically laughed us out of the room.

They have agreed promotions like no stamp duty to pay and he said he could upgrade one of the bathrooms for us for free as someone else had ordered the upgrade and then cancelled so they had the stuff on site, but that was it. There was no impetus to do offers, even though it was the last one on site. He said if it didn’t sell, they’d rather just leave it when they move off site, as it would sell soon for full price and they didn’t need to take offers. I had hoped he was bluffing but a friends husband works for a developer and confirmed what he said, disappointingly.

I hope you can be the exception, but go into it realistically so you don’t get disappointed!

We got cashback on ours but it was already built and sale had fallen through , it meant we had to take the kitchen that had been installed but it was a good spec and the £10k cashback allowed us to do things like install a huge patio after moving in. Sometimes they will incentivise a plot with a smaller garden etc so just be honest with them in terms of affordability and they may be willing to reach a mutually acceptable package / price

Years ago (and I mean 30 ish years ago) DH and I put an offer on a new build which was way below its listed price. Basically, it had already had one potential purchase fall through and the developers wanted it off their books. They kept suggesting lower and lower prices to us as they knew we were interested. We kept shaking our heads...in the end they said 'what can you afford?' And we told them and it was a done deal! The final price was £100K! How times have moved on.

Wow @Norugratsatall that's incredible! Just imagine. There's 9 of these houses being built so I'm looking on Rightmove and it seems the EXACT same spec and size were selling for 150k less a year and a half ago! I'm just so annoyed we didn't jump then. How can they put the price up that much in 18months. I will watch with interest as these newer ones sell and are listed on Rightmove 'nearby sold' prices as they give the house number which I can cross reference with the site plan. Wish us luck. Thank you for the advice everyone

@YouveGotAFastCar that made me chuckle 'we got laughed out the room'. I guess if we are stoic then nothing to lose eh?

When we bought a new build back in 2011 we managed to haggle a few upgrades ie flooring and nicer door handles than standard etc but they didn't budge on the basic price.

One thing though was we bought very early on in the development and the house prices then were significantly cheaper than towards the end of the building work; not just due to the housing market but I do think they start off cheaper to get the first few sold and then build on that (excuse the pun). Also may be true of the very last few houses as well.

Admittedly we bought our new build nearly 12 years ago, but we got it for a bargain.
Firstly as a PP says, check out when the builders end of financial year is, they'll want to sell/complete as many as possible before then & will be more open to offers.
Will they pay your deposit? Will they add in any costs (removal, legal fees, carpets, furnishings, turf etc)?
Are there any plots not selling? They may have smaller than average gardens, north-facing gardens; next to social housing; on a junction, shared drive/access? Anything that makes the plot slightly less desirable?
What we did/got (again bearing in mind this was 12 years ago & housing market was different):
Asking price was £199,995 (for 3-bed semi with drive, garage & garden)
We were ftb with no chain & £30k deposit.
There were 3 plots not selling - all north-facing gardens; one had a tiny garden; the other two were ok. The agent told us we should make an offer as the builders might accept if we could complete by year end (June).
We offered: reduce the list price to £185k; builders to pay 5% deposit (£9,250) which combined with our £30k deposit brought us down to a lower LTV mortgage rate for which we had a mortgage in principle offer. Our mortgage was then around £145k.
We didn't need the integrated fridge/freezer in the kitchen so asked for an outside tap to be fitted instead.
They wouldn't provide flooring included due to the price reduction, but quoted is £1k for carpets & vinyl. We approached a few suppliers & they were quoting much higher so paid the £1k. We also didn't get the turfed garden included due to the reduction, but that was easy enough to do ourselves.

So yes, it can definitely be worth asking, especially if the houses aren't selling, or some aren't & it's year end & the builders want to shift as many as possible.
Work out exactly what you need/can afford; what you want/like; & what you're willing to forego if necessary.
Have all your figures ready; including any wriggle room, & be willing to walking away if necessary.

I guess the upshot is that shy bairns get no sweeties.

Remember its a business/salesperson you are dealing with, not a personal seller who is likely to take the huff.

This is a business transaction rather than someone feeling insulted that you don't love their home enough to pay top dollar for it.

I'm in a new build flat

No different fittings were on offer

They took my 15% off offer, but I'd just had a purchase fall through, so recent proof of being proceedable, and I was chain free.

The development was built in sections though, and they were at the point of moving on to the next section, so wanted to get this one done. It was ready ten weeks later, on time, which was surprising. But I might have been lucky with the timing, if I'd made an offer a few months before, it might have been a no.

it's a low quality build though, IMHO. My previous flat was built in 2003 and I'd argue was better built.

The only time you can get a significant discount is when they have finished building the whole site and most are sold, the final properties are then needing to be off loaded so they can close the sales office. We were offered 25% off the final property once

Some developers are starting to feel the pinch, but they may not quite be ready to start discounting just yet... it might be coming though. Stewart Milne went under this week and also MJ Gleeson stocks looking very shakey despite the telegraph puff piece.

"completions fell by 14pc year-on-year and margins undershot expectations, thanks in part to sales incentives designed to shift unsold stock"

https://uk.finance.yahoo.com/news/housebuilder-balance-sheet-sound-despite-060000045.html

It also depends where in the country you are. We moved into our new build in the summer, we were the 10th property sold on a site which will be about 300 houses.

They've put prices up since we bought & are accelerating the build as demand is high. We asked about discounts & only got a key worker discount & an oven upgrade. Nothing at all off list price.

Yes, same experience here. Bought one of the last few houses on the development in 2018. Offered in November, they accepted a discount if we could move in before mid December as they wanted to offload the houses before Christmas and move on to next location.

We're looking at buying a new build currently and have bought one before. I've never heard of them taking offers on the list price, in my experience or from my neighbours.

What they do is offer "incentives". I believe we were told last time that it can be up to 5% of the value of the home but that might have changed or not be true. These incentives can basically be anything- there's a set amount of cash which is fungible so could pay your deposit, pay your stamp duty, pay for upgrades on the house, pay for legal or estate agents fees etc etc.

So when we last bought, they paid half our deposit. So we saved about £17k on the purchase of the home, but officially we still paid full price for it.

We bought a gorgeous Crest Nicholson new build 3 bed flat South East London Feb 2018. We negotiated £50k off the marketing price. Was £600k. We got for £550k and this was for the 3 bed 'show flat', which included everything furnished as seen (right down to the White Co. bedding!!). Some very top end Brand furnishings I must say. So please, don't think you cannot negotiate with new builds. That's an asbolute myth. My neighbours all paid £600k for the exact same flat but totally unfurnished. We were not FTB and most of my neighbours were which is why I want to tell all FTB negotiate. Please negotiate up to 10% and stick to your guns. Timing is everything. It helps if you seek out developments that state; last one or two remaining. On this particular development a few months later a "last remaining" 2 bed (850sqf) new build £80k knocked off the original price by the developer. Fact.

I don't think there's wiggle room for new builds I'm afraid. If you don't buy there are 12 other people behind you waiting to.

Choose a developer that includes white goods, flooring, turfed gardens. Many of them have higher spec show houses that add considerably to the cost if you want the same.