For most people, buying a new build property is a dream come true. Whether you’re a first time buyer, or you’re upsizing for more space, downsizing for something easier to manage or buying as an investment, you’ll want to make sure the purchase goes as smoothly as possible. Check out our 10 top tips from one of our legal experts, Lesley Stone, who has over 15 years experience in the new build sector.
1. Choose a solicitors firm with experience in new build properties
As soon as you have decided which property to buy, you’ll need to instruct solicitors to handle the purchase. Buying a new build is different from buying an older property, so when choosing a solicitor, check they have plenty of experience in new build conveyancing, so you can be confident they have the required knowledge and expertise. If you are using the Help to Buy Scheme, make sure they are experienced in this too, otherwise it could cause delays. Once you have appointed your solicitor, you’ll need to complete some paperwork and make a payment towards initial costs and disbursements.
2. Buying a flat? Check out the ongoing costs
If you are buying a flat, you will probably be buying the leasehold, so there will be ongoing costs such as ground rent and service charges. Find out how much the annual ground rent is, how often it will increase and by how much. Ask about the service charge payable and whether there is a residents’ management company responsible for managed areas.
3. Check the plan of your property
When buying a new build, whether it’s a flat or a house, always check the conveyance plan to ensure it shows the correct extent of the property you are buying. It’s much easier to correct any discrepancies earlier in the transaction rather than after completion.
4. Check what’s included
If you are buying off plan and the build is at an early stage, you may be able to choose finishes such as kitchen work-tops, floor coverings and carpets. Some options may not be included in the price, so it’s best to check. White goods are often included, but again it’s worth checking.
5. The builder’s guarantee
All new build properties come with a structural guarantee. Check exactly what it covers and how long it lasts – it can vary from 5 to 10 years.
6. Find a mortgage provider before you make your offer
Most people need to take out a mortgage to fund the purchase. It is helpful to have a mortgage agreed in principle before you reserve a property, so it’s best to find a mortgage broker or provider early on.
7. Help to Buy Scheme
If you are using the Help to Buy Scheme, make sure you choose a mortgage advisor who is familiar with it. This will help avoid delays. Also, Help to Buy has launched an online portal to help streamline the process. Bower Bailey is taking part in the pilot scheme. When you appoint Bower Bailey to handle your new build purchase, you’ll receive an invitation to activate your case on the portal and share it with us, so we can help manage the process efficiently using the portal.
8. Making an offer and paying a reservation fee
With new build properties, once you have made an offer and it has been agreed, you might have to pay a reservation fee in order to secure the property and have it taken off the market. Make sure you know in advance how much the fee will be – it is often as much as £1000. The fee forms part of the exchange deposit but if you pull out for any reason, it may not be refunded. As you can see, you will be paying out substantial sums from an early stage, so it is best to have a solicitor to advise you from the word go.
9. Communication is key
From the moment you appoint your solicitor, it’s important to let them know about any possible changes in your circumstances as soon as you can. In the course of the purchase process, you’ll be asked to deal with some paperwork. Try to complete it quickly and answer any queries promptly, to help avoid delay.
10. Check your completion date won’t put you at risk
On exchange of contracts, a completion date can be agreed but it is often ‘on notice’ rather than a fixed date. (The completion date is when the purchase transaction is completed and you can move in.) It is helpful to be as flexible as possible. With new build purchases, if the property is still being built, the completion date can be several months after exchange of contracts. It would be helpful to let your solicitor know of any impending holiday dates you have and, if you are currently renting a property, the expiry date of the tenancy agreement; your solicitor will endeavour to work around these dates.
If you’d like to talk to one of our New Build experts about your property purchase, please get in touch with your nearest Bower Bailey office.
