Negotiating on a New Build House

Zebsy

I would say, don't lose a house you really like for the sake of 500 quid, if you can afford it.
500 quid as a percentage of that property value is < 0.5 %.
When you say you can afford it, do you mean it's a big stretch?
If you can comfortably afford it, I'd say go for it.

Thinking about buying a new build myself so know how you're feeling!

Cheers,

Zebs

Mukk2k3

Thanks for views.

Well it would be a stretch for the first 2 years, but could probably manage it. Myself and my partner are currently in the middle of training contracts with our jobs and will have significant pay rises after the two years is up. But we are trying not to take that into account by thinking what can we afford now instead of struggling.

Can see what you mean about the £500, sometimes you just think if they can't get them to come down on the price then your not getting a good deal lol

Going to have a think before deciding what to do next.

Zebsy

Do you have your heart set on one plot or are you flexible?

I wouldn't advise you to stretch yourselves financially.
We are looking at a mortgage and the mortgage calculators are saying I could borrow more than TWICE what I am comfortable with.

But if you can save £500 somewhere else then you could look at it like that.
e.g. I recently didn't buy a new telly - I dont need one - I saved £500.
Ditto for an iPad!

Good luck...

Zebsy

Mukk2k3

Yes we have 1 plot in mind. It's an end link, therefore has a nice sized side garden and possible scope for furture extension if wanted to.

Can see what your saying about the £500 - in the grand scheme of things it is not a lot of money - especially if it means you get the house that you want.

Going to ring them to double check what exactly is included (e.g if the laminate flooring they are going to put down if good quality, turf, curtains, washing machine etc).

So if we do end up having to pay the 129,950 then I am going to make sure we get as many extras included as possible.

lzcook

Zebsy wrote: »

I would say, don't lose a house you really like for the sake of 500 quid, if you can afford it.
500 quid as a percentage of that property value is < 0.5 %.
When you say you can afford it, do you mean it's a big stretch?
If you can comfortably afford it, I'd say go for it.

Thinking about buying a new build myself so know how you're feeling!

Cheers,

Zebs

On the flip side for the sake of £500, a developer isn't going to want to lose a sale either.

The OP needs to demonstrate that they are serious - a mortgage in principle and confirmation of funds for the deposit and maybe having already instructed a solicitor to act on any purchase will stand you in good stead. Also seek written confirmation that the offer has been put forward to the developer.

However the OP will be in a much stronger bargaining position once the property is finished. No completion (ie when they get their money) is going to go through until the building is completed anyway so until then the developer may be content to see if any better offers come along. Once that property is finished, a first time buyer with a mortgage approved in principle is that much of a more attractive proposition as it means they can get their money quickly. For example I got somewhere between 10-15% off the asking price, along with things like curtains and blinds fitted.

Another option might be to see if they'll agree any other incentives like paying any service charge (if applicable) or council tax for the first year. These are costs that they would otherwise have to pay, and protects their headline figures.

Zebsy

I hope you're right about the developer, but they do sometimes do daft things.
It does sounds like one of the bigger and better plots so they may hold out.

Other incentives sounds like a good idea.

Your completion statement I'd agree with entirely - we went to one site with the last few plots remaining (and not selling) - 5% of the price was knocked off straight away without me even asking for a discount. More discount was obviously available.
All depends on the circumstances.

One thing - I would go to see some other houses.
Try to make sure the developer knows that you've seen other houses - that you like.
You never know, you might actually find another house you like more, and is cheaper.
OP - Do you have Property Bee installed???

ankspon

Hope it's not a Wimpey build,AVOID.

Mukk2k3

Hi Guys thanks for your input.

No the developer is not wimpey lol. Don't like to name the developer (encase they are doing some fishing) lol but it is one of the bigger developers.

Yes we have had a look at other properties in the local area and similar houses say 4 - 5 years old are going for about 130,00 - 140,000, so 5,000 - 10,000 than the current new property we are looking at for more or less the same size. There is also a redrow site development which stated about a year ago and the properties on that site are going for around 150,000.

As we are first time buyers the 5% gift is a big factor for us as it gives us 15% equity which enables us to bring our monthly payments down because of the reduced rate - therefore making it more affordable.

No I don't have property bee installed - what is it?

Zebsy

Are the other houses selling for 130-140K or are they on the market for that?
Depending on the market where you are, could you be offering 120K then settling on 125K?

Property Bee is a Firefox browser plugin. When you're surfing on RightMove and you see a list of properties, it shows you lots of extra info about each property... how long its been on the market, any price changes, etc.
The additional info Property Bee just inserts into the web page on RightMove!
Incredibly useful IMHO.

Zebsy

Having said that, if you're getting 5% back on the new build option, you'd need to go lower than 125K on those others...