Homebuy Direct

Neoneo

You may find they don't want to negotitiate because as part of HBD they are lending you money. They CAN lower the price but no doubt they've been told to hold out for non HBD buyers. I've gone through HBD and apart from them taking ages to do approvals and the banks not even being aware of HBD i've not had any problems so far and all seems going well. If you consider it a 25 year loan then there isn't anything wrong with the scheme. It helps you get a home, you own the full home and thats that.

Anyone bad mouthing the scheme 1) Hasn't been on the scheme 2) Has probably confused it with a sharing scheme 3) Is waiting 50 years for houses to crash to nothing before they buy. But as it's not a sharing scheme, as long as you are aware you have to pay back the loan in 25 years (wether by paying it off or selling the house) then it's not that much different to getting a non HBD house.

ztan

Yet more negative comments about a scheme that means people can get on the ladder without saving up every penny for the next ten years... *rolls eyes*

I've brought a house through a developers own version of HBD.. check out my diary in Mortgage Free Wannabe. There's a thread in here about Shared Ownership as well- read through there because its a split between Shared Ownership and Shared Equity.

Don't let it get you down, and don't let the doom and gloomers on here bug you!

spud211

The developer is 100% correct - if its a homebuy direct property then they are not allowed to negotiate or discount even 1p from the asking price.

The reason is to do with the value of the house. If they have told homebuy, and had it accredited by homebuy as being worth say £130k, but they actually sell it for £120k, then the house is actually worth £120k, not 130.

This then affects all the calculations for the scheme from the amount of equity available to the size of the loan, your contribution etc..and homebuy (the HCA) don't like that at all. So they have imposed a limit saying they cannot discount on them.

Now many homebuilders will bend this in other ways - when I was looking at homebuy properties I was offered all sorts of sideways discounts - free carpets, free kitchen/bathroom upgrades, free furniture packs etc, but the list price was always the same and none of the developers would budge.

Remember too that homebuy is effectively a discount anyway, as they are lending you 15% of the value of the property interest free, and this costs them money. As a result they don't really want to discount any further anyway.

Also be very careful about the actual property, developers always put their worst/most difficult to sell properties on homebuy as they can advertise them very cheaply, and the lower prices do draw people in..think twice about why that particular plot is on the scheme - I would put money on it having a bunch of negatives that make it hard to sell on the open market. Eg the ones I looked at tended to have tiny gardens, poor access to the rear, oddly placed entrances, poor accessibility to parking, "interesting" views etc.

Try asking how much discount you can get off a non homebuy property too. In one case (admittedly a flat) They were asking £70k (£100k list, £30k homebuy contribution) on the homebuy scheme, but when pushed I got them to offer me an identical property in a better location, NOT on homebuy for £70k..100 ownwership. thats a £30k discount! Admittedly this was a flat and I quickly realised that newbuild flats are a terrible idea and moved on, but still, interesting discount no?


That said homebuy is still a really good scheme if you find a property that you like and can get on it, largelly because of the fact you only need 5% deposit. If you do your research properly there is no reason not to use such a scheme while you can..it helps plenty of people!