New build - Advertised price vs. lender valuation

dumpallhere

A question for those who have bought new builds - what was the difference between the builder's "advertised price" and the "lender valuation"?


My story:

The development is 164 dwellings large, launched in end 2010, and is now at the fag end of its completion with only 4 houses left to be sold - in fact only 3, taking into account the one we have reserved.

The development has 32 houses of the type that we have reserved - out of which 30 have already been sold. The remaining two are in the initial build stage and we have reserved one, off-plan.

The price advertised was £270K (up from £250K in June 2011) but having done the groundwork of going through the sale prices mentioned on the land registry website I knew that out of the 24 for the which the sales had been registered till date only 1 had gone for £250K+. The remaining 23 were sold in the range of £225K - £250, with the lower end sale price being achieved in 2011 till end Q3 2012. More recently (last 9 months or so), the sales have been in the region of £245K-£250K.

I was hoping to negotiate down to £240K but the saleswoman refused to go below £250K - and no extras included. Being amongst the last plots on the development, and still in the build stage, I was not expecting huge discounts of 20-25K below £250K but, yes, was hoping to score around £240K. Needless to say the plots left are the worst of the lot - as can be expected - the only ones which do not have a south facing garden!!!! - and the £10K discount seemed reasonable to me. Alas, didn't happen!!

Since the development is in a rural area with sales few and far between, I have had no success in estimating the market value of similar properties in the area. And with about 4 same-type properties on the development having been sold for under £230K (and perhaps with gifts, extras, cash-back included), I have started thinking (and questioning my judgement) that I have agreed sale at a price that may have a "much larger than usual" premium attached to it.

To give you an idea of the sales (same type plots):
£225K - £230K = 4 plots
£231K - £240K = 7 plots
£241K - £250K = 12 plots
£250K+ = 1 plot.

dumpallhere

Any pointers?

littlesparkles

I just bought a new build and the lender valued at the price I was paying. This was the advertised price and didn't take into account the incentives (5% deposit paid. Stamp duty paid, removals paid, legal fees paid). It's the same for all of the houses here. Some are listed on the land registry with lower prices because they got a 5% reduction on the advertised price instead of deposit paid due to using one of the government schemes where deposit incentive is not allowed.

My plot was more expensive than other identical houses because it is a larger plot with a larger drive and garden.