The construction of new homes in the UK is at a nine year high with new housing developments quickly becoming desirable for purchasers. The process of purchasing a property that is still under construction can be different to a standard residential property purchase. Here are our top tips to consider when purchasing a new build property:
Do your research
A housebuilder will normally offer various types and sizes of houses on the estate; try to view as many show homes as possible. Research up and coming new build developments in your desired location and most importantly check the housebuilder accreditations before signing reservation.
Check the anticipated build date
There is little point purchasing a house that is not expected to be built for another year, when you need to move in a couple of months! Housebuilders will normally have timescales and estimated completion dates for the various phases on the development. Make sure you enquire about this.
Consider the schemes available to assist with purchasing
The majority of housebuilders will offer the Help to Buy scheme or a part-exchange scheme of your current property. This can be of a huge assistance with the financial pressure of purchasing a property and the stress of selling your current property.
Arrange your finances
Can you afford the mortgage on your desired property? Do your research or speak to a financial adviser! The housebuilder may be able to give you details of a recommended financial adviser. Bear in mind the anticipated build date when applying for a mortgage as any offer may be based on a completion date within 6 months.
Would you like extras?
Once the build of the property has started, you may wish to order extras to the property such as an integrated kitchen or fitted wardrobes. The house builder may ask you to pay for these extras or at least pay a deposit. Also bear in mind that when the property is due to complete, you will be required to pay stamp duty on these extras along with the purchase price of the property itself.
Be prepared to be flexible
When you purchase a new build property, you must understand that the property has not yet been built. There may be slight delays due to weather or the build taking longer than anticipated.
Inspect, inspect, inspect!
Before you legally complete the purchase of the property, the housebuilder will usually invite you to inspect the property. This is a process known as snagging, where you will report to the builder any concerns with the property and request that these are rectified.
More and more commonly, new build estates are operated by a management company. Particularly with larger estates, the builder will set up a management company to maintain the shared areas such as grass, shared footpaths and playing areas. You will have an obligation to pay a yearly management charge as well as various costs to the management company for obtaining information when you come to sell the property.
The house builder will normally give you a completion date on which you are expected to be available to complete. Try not to book any holidays close to the anticipated build date. Once it has completed, formal registration of the property with land registry will normally take slightly longer than usual. We usually estimate that this will take around three to six months.
With all the stress it is important to have fun when purchasing a property, particularly a new build. You can often choose furnishings such as carpet types and kitchen type before you move in; designing your house to suit your own taste.