Tell me your experiences of the newbuild buying process

[Tupster]

I visited some show homes at the weekend. I've never been anywhere near a newbuild previously so everything about the process is new and baffling to me. She told me you can only reserve a property when you've sold yours (assume she means SSTC rather than fully sold?) and that you're expected to exchange within 6 weeks, but completion could be many many months later if you're buying as soon as a property is released.

Sounds almost impossible to make happen, but I assume it must work because loads of people buy newbuilds. So has anyone done it? Can you tell me what your experience was and how you worked the timings?

Welcome to our world!👋
3-Years ago we were also totally naive about the newbuild buying process.😖

Exactly the same as you, have to be SSTC to reserve and exchange must take place no more than 6-weeks later with completion anything up to a year beyond this.

We SSTC quickly enough which allowed us to reserve but due to an incompetent/lying EA our exchange took a while and all the time the developer was pushing (and at times downright nasty). Anyway, it finally happened and the developer was all smiles again.
We arranged a 5-month gap between E&C on our sale (suited both parties) and then moved into a vacant family property for 6-months until the newbuild was ready.

Speaking to our new neighbours they all had similar experiences with some moving in with family for a year, others renting houses etc.
The only way to avoid this is if you are not dependant on the sale of your existing home to finance the purchase of the new one (the whole cost, not just the deposit).

If it's a Persimmon Homes development, take at look at the "Don't By A Persimmon Home" Facebook Group.

Generally, New Builds are a disaster waiting to happen. They are built to the lowest possible legal standards, and usually fail the majority of those. The "trades" are mostly hack jobs, done to deadlines. There is no pride or skill, just build them fast n cheap. If you go ahead with this, when you move in, take the bath panel off and let us all know what you find under there.

Think about this.

You don't have snagging companies for car sales, clothes shops or any other business. Even the development companies are admitting the product they are selling needs remedial work.

Would you pay 250k for a car that had to be taken back to the garage after you paid for it, to have all the broken bits fixed and other things added to it so it was safe to drive?

Also, New Builds will be in depreciate by a huge chunk the moment you exchange, because you now own a "second hand" home, so if the development isn't finished, the prices could vary significantly even for the "same" houses.

Pick any "New Build" estate and give it five years. The houses will be falling apart. Cracked and discoloured render, lose slates, dead lawns.

I really wouldn't bother.

Thanks @Cotswoldbee, that's interesting. How long did it take to get to exchange in the end? It's useful to know the 6 weeks is not completely unflexible. If one can at least get the sale and purchase exchanges to fit together it could work a bit better.

I'm looking at a very large development where I'd be very particular about which plots I'd be interested in, so it would likely be a case of trying to grab a reservation as soon as the right plot is released at foundation stage, so there's a lot to tie together in timings - plus a definite long wait for completion.

I am worried about the idea of renting though - I dropped out of a sale recently when my purchase fell through because I didn't want to risk being in rented. Cost to rent a 1 bedroom seems to be more than twice the mortgage on my current 3 bed - plus extra costs for storage for my furniture. It becomes a massive extra cost. I guess it's a string to tug on when negotiating with the developer for incentives.

I think it was about 10-11 weeks and while the sales team were horrible & threatening, the solicitor (local, recommended by the developer so knew them personally) was lovely and told us not to worry as everything was happening but just slowly.

We reserved as they started digging the foundations so we watched it being built and had lots of time to choose options.

I think @Hereyoume may have had a poor experience but what you need to understand is that there are good & bad developers and even the same developer can have good & bad developments depending on the handle the site manager has on the trades.
We were lucky and the development is well laid out & spacious and the houses well designed, built and any snagging required (of course there was some) was dealt with promptly.

Just another question @Cotswoldbee. Were you able to get much in the way of "incentives" when you reserved that early or do all the "stamp duty paid", "deposit contribution" etc just appear when the house has been hanging around a bit longer?

And, yes, I'm just ignoring the other poster and assuming they have an axe to grind rather than being helpful in any way. In the area I'm looking at there are so many newbuilds going up, the value for money is pretty amazing.

This is exactly why we didn’t buy one. To sell your house, conclude missives (Scotland) within 6 weeks but potentially not be able to enter your own new property for 9 months is just ludicrous to me. Not doable for many many people, particularly families.

Also the way they release the plots. You can’t just go in and say yes I’d like plot 14, you need to wait until it’s released which could be months away.

Have you asked about part exchange? We did this and because the developer was buying our house it meant we could stay in it until our new one was ready.

I’m on my second new build and not had any of the problems that a pp referred to. Only a handful of very minor snags on both houses that were resolved very quickly. Wouldn’t have any issues buying a new build again in the future.

@Tupster
We got some upgrades which even the sales team were surprised about (we bought in the silly time) as there was no difficulty getting buyers.
Amtico flooring, dishwasher, garage services & personnel door etc. Based on the options pricing, that lot was worth over £10k.

Speaking to neighbours, one got SD paid (on a cheaper property) while someone buying the same as us got nothing. Didn't seem to be any specific pattern but they all agreed that experienced a rotten time from the sales team.

We also trade in. Got about £10k below market value for it at the time after a bit of negotiation. We were happy with this as the price of the house we reserved went up £30K for subsequent releases within that time frame so we were much better off. Our trade in sold within 48hours which tbh wasnt an issue for us but by god di the developer have to work hard keeping them happy while our house was built.

Its a different market now but i wouldnt exclude part exchange if you can make the figures work for you.

As for new houses being better or worse.....well where do you draw the line, every house was a new build at some point. Ive lived in 1970's Barratt builds. Early 2000's Independant builder build, 20 years in another Barrat build and now in another slightly more upmarket newbuild. All new builds and had ups and downs but none anything to bad. Is it any worse than some of the horror stories for houses where the previous owner has hidden issues or done works themselves....

We wanted to move into a new build for our next house and basically found it's impossible if you have a house to sell yourself. The chances of lining everything up in a way that your buyer will be willing to hang on are minute.

Basically, sell your house and then look at whether the newbuild companies can offer anything that lines up. Don't go look and get excited about certain ones before your house is sold, because you'll just watch them disappear from the sites as they get reserved.

It’s even trickier in this market if your house takes a while to sell. We put ours on the market in January because the builder had some which would be ready for June/July/August. We still haven't sold (FTB house in an expensive area), those houses got reserved months ago and now the builder won't have any houses of the kind we want until either November or early 2025. We’re going to go back to them when we sell and see if anything lines up, but I’m not holding my breath.

Interesting, thanks - especially hearing that there were still some incentives around even when the market was crazy. Certainly if I bought one of the completed houses by the same developer that are currently advertised, some are being advertised with "savings" of over 20k plus "upgrades" worth well over 10k - although I don't personally think there's any real value in upgrades that you didn't choose yourself. I'd like to think some of this might be available when reserving off-plan.

I do like the idea of part exchange but they haven't mentioned it being available and I don't see it offered on the development at all by this particular builder. I will probably raise it at some point though - it's always worth asking. I wouldn't have much wriggle room to accept a low offer on my current property though, so it might not work.

@ClonedSquare Yeah, what you describe is exactly what I imagined could happen. I'm looking at a section of the development that likely won't be ready for completion until winter 25 and might not be released for reservation until the end of this year or early next, so I've got time to maybe try and sell ahead of time if I really want to do it, but there's a lot of risk in trying to get the house sold before you even know how much the house you want will be or whether you have any chance of getting it before anyone else does.

Everyone's responses are really helping with the thought process though. Thanks!

I have no Axe to grind.

You'd be a fool to believe that New Build houses are fit for purpose.

Be careful. Because once they have your money, you are on your own.

As I said, snagging means they the developer is so inept, that they have handed over a brand new home and can't identify the issues it has. They rely on the buyer to find all the faults.

Does that seem like a good deal?

If you wanted an extension built, and the builder you hired said

"Well, me and the lads will give it a go, we will do the quickest job we can, and use the cheapest materials we can find. Pay us all the money you owe, then give me a call when you find all faults with our work. They're will be a lot, I'm just letting you know now.

If I don't return your call, which I won't, you can call another company who will charge you £1200 to list all our mistakes and send us a letter. We won't reply to that either.

So yeah, thanks for the money"

Would you still be in a rush to do business?

@Hereyoume
You obviously had a completely different experience to us (and a lot of other people) but if you have learnt one thing it is that not all new builds & developers are the same.

@ClonedSquare this is what was happened to us, we ate in the higher bracket of house selling and it's slower so the house we wanted has now gone to someone else and new batch not ready till Oct-Dec, no dates yet,so wondering what to do. Wondeeing if should we keep house on market or move to rented. Did you end up buying a new build?

If you can make part exchange work for you or move in with family if it comes to it that will help.

We put our house on the market in Feb, put a deposit down in March, sold our house in May, the developer initially said July for completion. We were clear to our buyers we weren't moving until summer holidays, so if that was going to be an issue they needed to find another house.

In the end the build dragged on and on, completion date kept moving so in the end we completed on ours end of July, put stuff in storage and lived out my dad's spare room for a month. We moved in on August bank hol.

It was a pain, but I love the house. All worth it in the end.

OP please don’t dismiss information about poor quality new builds as axe grinding. I’ve never bought one but I see scaffolding going up on estates a year or two old, damp appearing on outside walls, residents complaining about drafts round badly fitting windows meaning huge energy bills. Not saying there are all like that but it’s a serious risk.

We were told about a 10% reduction in price when part exchange, so didn't even consider it as its a large amount. May look into it further thank you. We have nowhere else to go and we are 2 households moving into one big house so a little more complicated 🙈

We’ve bought four new houses. We sold, borrowed a friend’s house for three months for the first. The second was a ex show home at the end of a phase, so we sold and bought in the usual way, moving out of one and into the other on the same day. The third, we sold and reserved at the beginning of December, exchanged on the purchase and completed on the sale and moved into rented in March and moved into the new house in August. The last one, we sold STC in August and reserved the house already built and moved into November.

We’ve had stamp duty paid twice, extra cupboards once, curtains and light fittings in the ex show home and replacement turf.

The houses have all been with developers who include landscaped front gardens, turfed back gardens, washing machine, tumble dryer, dishwasher, carpets and flooring and some wardrobes.

Depends on the developer

We also have landscaping, all fitted kitchen,solar panels etc etc also stamp duty paid which is almost 30k. We don't have anywhere to move to and the last new build I bought was ready to move into,so very straightforward my 1st apartment was off plan and they were both many many years ago. It's stressful trying to sell whilst the house you want is not reserved so we could end up selling with nowhere to go till end if the year. Asked about part exchange but need 40% difference between price of houses and we would loose a lot going that route unfortunately .

We've been in a new build for 21 months. We were 6 months late moving in and had sold our house - went abroad, lived with a friend, stayed in our caravan. I would not buy a new build again. The house is fine, garden isn't great, but the real issue is we are living on a building site adjacent to land which should be green open space but is still a car park and trades yard. We are not even sure they will do the roads properly or the landscaping before leaving.
They set up a company for each building site then just liquidate it at the end and set up another company for their next building site.

We just told the developer that we weren’t reliant on selling our current house to fund the one we wanted.

That said, the market was very buoyant at the time so knew our house would sell easily.

As for the horror stories regarding new builds, ask lots of questions. We have never had an issue with ours but do know that others in the same development but different company did.

And snagging is normal. It happens due to wood and various other bits settling and this can cause some, typically, small issues - fil was in the trade and was totally on this as to what to expect.