Homebuy Direct - Negotiating House Price?

TheLloyds

Hi,

My wife and I are currently looking at buying a house through the homebuy direct scheme. We are both FTB's and meet most of the criteria that is stipulated.
There are only a handful of houses available on this scheme in our area (Stone, Staffordshire) and are priced at around £190K for a three bedroom townhouse. This seems rather high but the housebuilders are saying they would not be able to budge on the price as they are on Homebuy..!!!
Is this the general concensus or have we still got grounds to negotiate on price?
The houses are still in the process of being built with a completion date of sometime in March so technically we'd be buying off plan.

Thanks for any advice you may have.

tb1105

nope, we're getting a 3 bed on homebuy.
Advertised at £189,950, got them down to £185,000 with £2,500 extras. Valuation has come back at £180,000 so just waiting for appeal results to come back. All houses are up for negotiation

TheLloyds

Hmmm....that's interesting. We'll definitely try to negotiate then. The house is being sold with no flooring or appliances so we'll push for extras also.
Thanks for your reply.

tb1105

ours too, not even turf!
we originally negotiated £185,000 with £2,500 extras but changed to £187,500 with £5,000 extras (if you own under 75% of the house the interest rates are better)

Survey has come back valued £180,000 with £5,000 extras included so hoping persimmon will stop messing round and let us have it for that!!!

lartin_mewis

Is that pr1ck Applegarth still a director of persimmon do you guys know?

kokoro

I'm currently considering purchasing a property on the Homebuy Direct scheme and would be interested in any updates on this topic. Has anyone else successfully negotiated the price while using this scheme?

noopys

I viewed a newbuild that Persimmon are selling recently and enquired about the HomeBuy route.

I was told by the Sales Rep that in no uncertain terms could they negotiate on the price or offer any incentives whatsoever if someone is to purchase via HomeBuy.

If you can avoid HomeBuy do it, because the only people winning are the developer and government who will own equity in your home, which means you won't see much from the profits (if positive equity) from the sale in the future.Additionally there are many restrictions, such as only being able to use certain lenders, which may cost you much more in the long run as you may not get the most competitive rate available at the time.

AVOID!

Muhasib

lartin_mewis wrote: »

Is that pr1ck Applegarth still a director of persimmon do you guys know?

resigned October 2007

Monkey_Speaks

I agree with most of the posters here. Avoid Homebuy schemes if at all possible!

I looked at that option, and these are some of the conclusions I made:

1) These schemes are not offered out of charity. When I was looking, the property developers, financial advisors and banks all seemed to be getting more out of the deal than was I.

2) Look at the interest rates you are being offered. Terrible, aren't they?

3) It is definitely possible to negotiate on price, especially, if as is likely, the valuation comes back under the sale price. Play hardball and don't take no for an answer. New homes are traditionally over valued, so you may end up on the first step of the housing ladder with nowhere else to go! I think we negotiated something like £30k off the price of our 1 bed flat.

4) Be very careful when you look at the contract. My solicitor found all sorts of objectional stuff in there, ranging from excessively high penalty clauses to a dormant right of way straight through the middle of the building!

fraxos

Just to add to this thread.

I am in a similar situation as the OP. I have found a nice 1-bed in Bow, London for £215k, which I think is overpriced, especially given that I would have to pay extra for the flooring and there is no parking space. The developer claim that there is no way they could negotiate the price as it is on the Homebuy Direct scheme. I still feel that I should come in with a lower offer but there are only a few flats left and I do not know if there is much room for negotiation.

Any suggestions?

TheLloyds

Thanks for the advice. We are moving into our house in 3 weeks purchased through the Homebuy Direct scheme. We are very happy with what the scheme offers considering we get much more house for our money as the mortgage interest rate is based on a lower LTV due to the Homebuy contribution.
Our interest rate is 4.01% which considering we are FTB's and have only put a 5% deposit down is pretty good I think. There seems to be a lot of pessimism regarding the scheme but without it we would not have been able to own our own home for some time.
With regards to price negotiation, they would not budge on price but we settled on an upgraded kitchen, and all flooring (not just carpets but ceramics too).