New Build depreciation

DiscoCat54

My husband and I are currently doing a part ex with Bloor. it isn't our ideal home and it isn't our location however it does get us out of our current hole.

We are currently spending £5.5k a month on a property that we don't use and can't sell as well as a rental in a different part of the country close to where we work.

The payments have been crippling us and after a failure to sell we went down the part ex route as a means of consolidating.

We intend to stay in the new house for 2 years and then sell and buy something that we love.

Assuming the Market says the same how much would we be likely to lose? After the consolidation we can afford to save 3k per month for our next deposit but I'm curious to know what the average depreciation is on a new build? It's a 385k house in West Sussex.

DiscoCat54

Might be worth mentioning that 4-8 week valuation on my current house was 250 and Bloor have agreed an offer of 283

PasturesNew

No idea... but I know somebody who bought a house on a new build estate, then a year later decided they wanted a bigger house on the same estate - they lost 17% in 18 months between 09/10 and 03/12.

Another on the same estate was sold on the open market and lost 8% between 11/08 and 11/11. They had originally got 8% off the new build asking price, so a bigger drop than it looks.

Every house, every estate will be different of course.

Owain_Moneysaver

Assuming (from a quick look at Bloor's website and the price you mention) you're looking at something like a 4 bed house on a development of similar houses, I think it will hold its value better than the 1-2 bed starter home developments which are the most vulnerbable to depreciation.

The larger size of house will probably appeal to families who will stay for at least the children's schooling so won't look to move in 2 years time, unlike FTBs who buy a one-bedroom and then find themselves pregnant.

Even so, not all plots on a development are equal, look for larger garden, better outlook, south facing lounge, private rear garden etc, which may not add to the price but will add to the desirability.

And given a choice of developments look carefully at school catchment areas.

DiscoCat54

Unfortunately the only house in the style that we wanted had an especially small garden. They have since released one more for an extra 10k however it is north east facing when ours is south west.

For the timescale that we needed to work to we had little if any choice.

john_white

Doubt it will lose 70k which is what you'll lose by not taking the px.

33k over value
33k in 6 months costs
4k selling fees

Poppy9

When you say especially small garden, how small are you talking about? If you are not staying put long term then consider a different style house with a larger garden as an extremely small garden on a family house will make it more difficult to resell

DiscoCat54

It was the only style that was available that matched the price/timescale/configuration that we needed. We looked at all of the new developments within a 30 mile radius and this was the only one that had properties that matched the required part ex differential and would take a property in a different region.

Poppy9

So how small is the garden?

Thrugelmir

DiscoCat54 wrote: »

Might be worth mentioning that 4-8 week valuation on my current house was 250 and Bloor have agreed an offer of 283

Have you had the mortgage valuation performed on the new property?

You have to view the p/ex transaction in its entirety.

DiscoCat54

Mortgage valuation was done last Thursday. I haven't seen the figures yet but the mortgage has been agreed.

The garden is about 30' x 30'