David Wilson, incentives and Help To Buy

altitude2k

Hi all,

My wife and I are looking at buying our first house in the near future, and this weekend we popped into a small new development from DWH. Loved the style of house we found, love the location, but they're now coming to the end of the build so if we want one we'll have to move fast-ish and we weren't quite ready with our savings for a deposit.

Speaking to the rep in the show home, she suggested we look at the Help To Buy scheme (which, based on the interest rates looks to be the way to go in any case). Apparently they will categorically not reduce their prices - but they will offer various incentives, such as upgrades, cash towards deposit, cash towards stamp duty etc. That's all fine with me. However, she said they would not offer incentives if we were to take out the HTB scheme - it's basically either one or the other.

Didn't have the presence of mind to question it at the time, but before I go back to talk to them I need a bit of a sanity check! Has anyone else heard of this from any developer? Is there any logical reason why they wouldn't negotiate on incentives if I take out a HPB loan? The way I see it is that it's a government scheme, and how I choose to pay for the house is my business.

Any thoughts would be greatly appreciated.

thedalmeny

I don't think they can offer cash incentives on the scheme, such as paying your stamp duty or legal fees.. Somebody else may be able to clarify?

We move into our new build in 3-4 weeks (Have already exchanged), we used HTB.

We got the following throw in;

- Property discounted from £192,000 to £182,000
- Integrated fridge freezer
- Carpets
- Rear turf

We also got stamp duty paid by Halifax, was a limited offer on for first time buyers.

Long and short of it is though - no they're no restricted from offering extras or discounts on house price.

altitude2k

That's what I thought, thank you for the reply.

Part of me wonders whether they would even know where that cash came from, other than the lender.

thedalmeny

Most developers tend to take a hard line of "NO DISCOUNTS" on government schemes, they often give way on this after some negotiation but they're in a much stronger position at the moment with the market recovery.

kingstreet

The builder completes the CML Incentives Form and hands it to the surveyor when the valuation is done.

Some lenders don't like incentives and will simply deduct them from the property value, so you end up with the simple price reduction you could have arranged in the first place.

thedalmeny

kingstreet wrote: »

The builder completes the CML Incentives Form and hands it to the surveyor when the valuation is done.

Some lenders don't like incentives and will simply deduct them from the property value, so you end up with the simple price reduction you could have arranged in the first place.

I swear kingstreet, the amount of advice you give out on this forum is almost indispensable in my opinion. You're like the moneysavingexpert housing forum god, or at the very least jesus.

altitude2k

I think the consensus is that they're just being difficult and leveraging the market, and not expecting a lot of people to argue. The fact of the matter is that there is absolutely no urgency to move (we planned it for Summer 2014), so the negotiating is on our side. If we lose it we lose it - not the end of the world.

Thanks for the replies.

GlamGirlie

Help to Buy is a Govt scheme not a DWH scheme.

martinsurrey

altitude2k wrote: »

That's what I thought, thank you for the reply.

Part of me wonders whether they would even know where that cash came from, other than the lender.

As well as the CML forms for incentives

The developer has to apply to get you onto the HTB systems, so they 100% will know where the money came from.

and your right, they are leveraging the market, you cant really buy with a 5% deposit any other way...

altitude2k

martinsurrey wrote: »

The developer has to apply to get you onto the HTB systems, so they 100% will know where the money came from.

If that's the case, what happens when using HTB on a resale property? Why is it different?

martinsurrey

altitude2k wrote: »

If that's the case, what happens when using HTB on a resale property? Why is it different?

you cant buy anything other than a new build on HTB, YET, and the mechanisms they will use for the resale market are yet to be detailed.