New Build - How much should we offer?

SF09

Hi,

OH & I are looking to buy a new build 3 bed end-terrace townhouse on a local development. The selling price for this property is £181,995 - we were thinking of starting off with an offer of £160,000. What are your views on this please? Higher/lower/just right?

Similar 2nd hand properties in the area are currently on the market at the £180,000 mark.

We've had our current home valued by surveyors for P/X purposes but we don't think they'll come close to the £145,000 private valuation we've had. Has anybody had experience of getting the builders to up the P/X value AND drop the price on the new build? We need the right combo of numbers to get the best mortgage deal if we were to P/X. If they can't come up with a good deal for us then we'll sell privately with the hope of our preferred plot still being available once we've sold.

Thanks

rodders470

Always start low. However your bargaining position won't be as good as you are using part exchange, which they will say in the main incentive.

However saying that, i'm completing on a house next week and we went through part exchange. Our house was valued at £125k and they offered £120k initially, but got them to increase the offer to £123k.

They also reduced theirs from £178k to £167k plus carpets and vinyl.

Good luck!

sirmosh

In some areas new builds are sitting empty for as long as a year before selling, if that's the case near you then there's every chance the developer will bend over backwards to sell you a house. I was offered stupid amounts off of new builds around my area as they're sitting empty and just won't shift. If new builds are selling quickly in your area then it'll be much more difficult to get a good deal.

As for your offer, it depends entirely on the situation, some vendors may think £20,000 below asking at that price range is outrageous whereas others will simply ask you to offer some more. If it's been on the market for a good while then you'll obviously have a greater chance of persuading them it must be over valued.

SF09

Thanks for your quick replies

Hopefully we can negotiate something similar, Rodders. We are fully prepared to walk away and sell privately if we can't come to a suitable agreement.

I'm not sure how long the development has been there (we found it by accident when going to get info about a different one we'd seen advertised). The whole village that the development is on is new builds only so plenty of competition. Show homes at this particular development opened 2 months ago and their site plan seems to be dotted with far more FOR SALE stickers than RESERVED ones. Of the 8 houses in the style we're looking at, 7 of them are still available. We're hoping that this means that business for them is slow and with their financial half year coming up at the end of Dec....maybe there's more room for movement in values

mattdragon2

My friend just bought a new build. Was on market for 165k, sold for 150k though he thinks he could have got less for it. So maybe try 20k off.

When I rang for a mortgage, my bank told me I need a 25% deposit on new builds, I guess cause the price can change quite quick for them.

MrRee_2

New Builds are where all the bargains are ..... builders have zero emotion tied in, you see?

Secondhand homes have family memories and stuff ... sellers put a value on them, and shouldn't - but it's hard not to sometimes. It's very hard to get a hard nosed bargain when a family has grown up in a place and the family is selling due to a death.

Builders don't give a toss about their properties - cash flow is the name of the game to them .. they need money coming in.

However, in cahoots with EA's, they are a formidable foe ..... fix your prices in your head and do NOT deviate from them!

Good luck!

shortchanged_2

MrRee wrote: »

New Builds are where all the bargains are ..... builders have zero emotion tied in, you see?

Secondhand homes have family memories and stuff ... sellers put a value on them, and shouldn't - but it's hard not to sometimes. It's very hard to get a hard nosed bargain when a family has grown up in a place and the family is selling due to a death.

Builders don't give a toss about their properties - cash flow is the name of the game to them .. they need money coming in.

However, in cahoots with EA's, they are a formidable foe ..... fix your prices in your head and do NOT deviate from them!

Good luck!

Fair play you are absolutely clueless for such a made man.

It's well known that new build properties are always overvalued and that builders will try desperate attempts to maintain the high prices by any means such as shared equity schemes and throwing in carpets for free etc :rotfl: rather than lower their asking prices.

New builds are certainly not a bargain.

MrRee_2

shortchanged wrote: »

Fair play you are absolutely clueless for such a made man.

It's well known that new build properties are always overvalued and that builders will try desperate attempts to maintain the high prices by any means such as shared equity schemes and throwing in carpets for free etc :rotfl: rather than lower their asking prices.

New builds are certainly not a bargain.

You MUPPET!!

The BUYER makes them a bargain .... dear me, are you one of those who pays asking price!?

And I had you down as a wise one ...... I'm not normally wrong, seems I have messed up big time, this time.

shortchanged_2

MrRee wrote: »

You MUPPET!!

The BUYER makes them a bargain .... dear me, are you one of those who pays asking price!?

And I had you down as a wise one ...... I'm not normally wrong, seems I have messed up big time, this time.

I'm perfectly aware of that, however as I stated new builds don't have a very good record of being a bargain, hence the reason why they feel the need to offer these shared equity schemes etc instead of reducing their price.
Chances are if you buy a new build today you will almost immediately be in negative equity.

Bit like buying a brand new car really. Once you've driven it off the forecourt thousands are wiped off it's value.

MrRee_2

I never pay list price on a car - lets say a Car is listed as £22,500 ..... I buy for £17,500 after hard haggling. I suspect that is the price it's worth when driving it away. The dealer said that some people just come in and pay list. Not my problem, but I have made the dealer take the very first hit - as all car guides state the list price and base the values after that.

Same with a House, a NEW house that is ...... house is £200,000 on the list. Haggle hard, ignore all incentives and go for the base price - settle on £160,000.

I very much doubt that house purchase would have negative equity ... do you, really?

shortchanged_2

Is that where you are then MrRee, that a new build is willing to knock 20% off the asking price?

I thought the housing market was really strong where you are and they were achieving nigh on asking prices.