Frequently Asked Questions
Do new builds go up in value?
Asking if new builds go up in value is a very common question. The short answer is yes. From the data we have we can say that new builds appreciate at the same rate as all other properties. However, when we purchase a new build we have paid a premium, meaning the actual value can be 0-10% below the price at which you purchased it. So if we took a £200,000 new build, minus a 5% premium (£10,000) would be a £190,000 property appreciating like everything else. So, do new builds go up in value? Absolutely, yes.
How do I buy a new build house?
Lots of people aren’t sure on how to buy a new build house. We start with how to find a new build house. To do that we would start with an online search on RightMove or Zoopla and filter by ‘new builds’. Alternatively, if you know which developer you’d like to buy a home from (say for instance, Strata Homes) and browse through homes. Now we know how to buy a new build house, the next part is to the procedure. The developer will Shepard you through the process, though you will still need to elect your own legal & conveyancing. The typical time frame can is 3- 6 months but can be as short as 4 weeks!
How long does it take to buy a new build home?
When we ask ‘how long does it take to buy a new build home?’ people struggle to answer because it varies so wildly. On average it takes 3-6 months to purchase a new build home. Firstly, the date at which your home you are buying will be actually constructed will affect how long the new build takes to build. If the home is already built, it will take the same amount of time as every other home – around 3 months. If the home is due to be built at a time greater than 3 months, the completion will be in the month it is finished being built. Most developers will have some available immediately and some being built 6 months – 24 months into the future. If you were to force an average, within a 6 month time frame you should be able to buy your desired property. So, how long does it take to buy a new build? 3 months up to 12 months, dependant upon the built completion.
Is buying a new build a good investment?
Asking if buying a new build is a good investment is an excellent question. We want to live an excellent place and also want to know it will serve us well. So, is buying a new build a good investment? Yes. Firstly, we need to appreciation that we will generally overpay for a new build by 0% – 10%. This is generally because of the extras and incentives the buyer gives to you and the ‘new build feel’. Once we discount that new build premium, the home will generally start to appreciate in line with every other home. The key difference: Because it is a new build, you will save thousands on repairs and upgrades. You have a 10 year NHBC guarantee for anything that goes wrong and when we take that 10 year saving against the premium and time saved it starts to look very interesting. Beyond finances, a new build is a good investment into your personal well being, being complete and relatively hassle-free.
Buying a new build home timeline & buying a new build process
The timeline for buying a new build is different, dependant upon the developer you’re purchasing from. Understanding the buying a new build process is helpful in terms of shaping your expectations, We will assume that the property will be read to move into within 4 months. If it is later than 4 months, a few of these steps will be pushed back.
Day 0 – You have decided which home you’d like. If the price has been released you will need to put down a deposit of around £500 and if the price hasn’t been released the developer would still ask some sort of deposit. You will also need to get your mortgage in principle.
Day 30 – Enlist solicitors and work with the new build developers to push through the key paperwork. You will also need to get your mortgage offer at this point.
Day 40 – Choose your extras. Around this time, you’ll be picking-out what types of extras you’d like in your new home from the carpets and wardrobes to kitchen and towel warmers!
Day 60 – A lot of new build developers will look to exchange contracts by day 60. This means having your deposit, if they wish to exchange early. This will also mean that you are legally tied into purchasing the property, or at least paying the deposit. Developers often do this to secure their build portfolio and, dependant upon their size, to cash flow the rest of the build.
Day 120 – After 4 months you’re ready to move in! At this point the home will have been exchanged and completed, assuming the development time-frame hasn’t been pushed back – which can be the case with bad weather etc… You will then be handed over to the after care team, who will walk you through settling in your new home. Also, you will be producing a snag-list and the developer will look to repair/amend any defects in your new place.
The timeline for buying a new build does vary, but the above should give you a rough and working idea of the process of buying a new build and what the timeline tends to look like.
How to negotiate new build house price 2021 UK
As a general rule, it is difficult to negotiate the price on a new build property. Decreasing the value of a house for one sale will cause the house type to be devalued. However, although rare, there are some occasions in which you can negotiate the price of a new build. So, here’s a quick overview on how to negotiate new build house price:
Off Plan: If the developer has yet to start building, or is in the early days they may still be looking to secure finance. By securing buyers quickly
Year End: And half year! When a developer is approaching the end of their financial year is when they’re scrambling around to really hit their sales targets – which is great news for us! It’s the time when a developer is much more likely to lower the price of a new build. The month of year end can be found using companies house.
End of Development: If there are only a couple of homes left on the development you may well be in luck for a new build bargain. Developers may be most willing to negotiate with you at the end of their development for two reasons:
1) They’re wanting to wrap up and move their focus and resource to a new development.
2) Negotiating the price of the remaining new builds won’t affect the sale price of the rest of the development- as they’re already sold!
Hopefully this gives you a brief overview on how to negotiate new build price for 2021 and beyond!
How is Council Tax calculated on new builds?
If you’re wondering ‘how is Council Tax calculated on new builds’? You wouldn’t be alone. To understand what your Council Tax band should be the Local Council will need to come out to your address and make an evaluation. The exception to this is if there are identical houses nearby, though this of course differs from Council to Council.
Find out more first time buyers guides here.