Negotiating new build price - Persimmons

TClite

Currently at a negotiation stage with the sales rep and we have the following incentives on the table at the moment:

- carpets / vinyl
- £675 towards kitchen upgrade
- £1000 off asking price

I told him thanks, but we weren't happy and asked for him to do better. Are we being unreasonable? From what i've researched on the subject people are getting a lot more. Our house isnt built until June and we have it reserved until Nov 2 so my concern is that they have so much time to sell that we have less room to maneuver and they can afford for us to walk? We are first time buyers and maybe a bit naive so im hoping for some advice on tactics on how to play this game. The thought of getting ourselves in negative equity right away is quite scary.
We have a 15% deposit if this is relevant and the purchase price is £122,995 2 bed mid terrace.

TastyTeeth

Do you have any data on what other equivalent house types have previously sold for on the development?

By the sound of it, this house is at an early stage of build. Therefore deals won't be as forthcoming than, say, when its a few weeks off being ready. Builders always have a deal and my view is that there's another £1k to squeeze out yet. Not much more than that I'd say.

Folks will tell you there's £10k+ to be had yet. If they do, ask them to take over your negotiation

Thrugelmir

TClite wrote: »

The thought of getting ourselves in negative equity right away is quite scary.

Buy when you have a larger deposit.

Our house isnt built until June and we have it reserved until Nov 2 so my concern is that they have so much time to sell that we have less room to maneuver and they can afford for us to walk?

Correct. They can bide their time.

TClite

TastyTeeth wrote: »

Do you have any data on what other equivalent house types have previously sold for on the development?

Theres only 2 of our house type and both arent built yet. There is another development not too far away and one has been sold on their site, I cant seem to get hold of the selling price though, any ideas on how I can get that? It doesnt appear on zoopla/rightmove etc

TastyTeeth wrote: »

Folks will tell you there's £10k+ to be had yet. If they do, ask them to take over your negotiation

Its a shame, I was hoping for somewhere between 4-8k based on what ive read on this forum. Is it really all in the timing then?

TastyTeeth

TClite wrote: »

Its a shame, I was hoping for somewhere between 4-8k based on what ive read on this forum. Is it really all in the timing then?

Definitely. Why would a builder discount a house by £4-8k at this stage of the build process? If you don't buy it, someone else will soon enough.

The builders only really look at larger discounts if:
a) The house is almost ready or finished stock
b) Not a lot is selling on the development and they have several of the same house type available
c) Its getting close to a financial point in the year (end of year, end of quarter)

A 15% deposit doesn't make any difference to the builder. All it does is gives them more confidence that your mortgage application is more likely to proceed. They get their money either way. If you we're a 100% cash buyer you might get a bigger discount.

Like I've said there's still more to be had from the deal, but I'd be very surprised if you could get even the minimum £4k on top of what you've already got on the table. More likely £1.5k more maximum on this plot.

andy.m_2

TClite wrote: »

. The thought of getting ourselves in negative equity right away is quite scary.

then consider not buying a new build.
You will potentially be in negative equity when you turn the front door key for the first time and you lose the "new house" premium.

TastyTeeth

andy.m wrote: »

then consider not buying a new build.
You will potentially be in negative equity when you turn the front door key for the first time and you lose the "new house" premium.

The thing to remember when buying a new build is that you have to be thinking long term with the purchase. You're buying a home, not a house! If you're happy with that, then it shouldn't really matter if you fall in negative equity in the first few years.