Expected reduction on a new Taylor Wimpey property

Clueless27

My partner and I are currently renting and we are about to make an offer for a new Taylor Wimpey Home in Newport South Wales. I was wondering if anyone has any advice about the level of discount we can expect to receive from this developer?

The house is advertised for circa £280k so obviously stamp duty is a huge expense which would come directly from our deposit.

Would it be best to negotiate a lower asking price and we pay the stamp duty or ask the developer to pay the stamp duty? Any advice would be greatly received.

Thanks

kingstreet

If you need a mortgage, be aware that any cash incentives in excess of 5% will be deducted from the valuation when the surveyor gets the CML form.

Anything over that might as well be a simple price reduction to avoid the hassle.

Tancred

kingstreet wrote: »

If you need a mortgage, be aware that any cash incentives in excess of 5% will be deducted from the valuation when the surveyor gets the CML form.

Anything over that might as well be a simple price reduction to avoid the hassle.

It's unlikely that any incentive would be more than the 3% SDLT.

LondonDreamer

Are you going to use Help to Buy? If so, probably no (or very little) discount. From everything I've read, developers feel like they don't have to negotiate with buyers who are already receiving a large incentive from the government. But you might be able to get some extras added on, depending how quickly the development is selling.

If choosing between discount and stamp duty, I would go for the latter as it's an upfront cost. A 10k discount (as an example) on a property mortgaged over 25 years isn't as noticeable a saving than not having to find over £8k upfront. If you already have the funds available, they can then be repurposed for something better - e.g. larger deposit, some new furniture, putting back into savings, etc.

This is assuming that this option wouldn't affect the mortgage offer, as mentioned above.

Tancred

Clueless27 wrote: »

My partner and I are currently renting and we are about to make an offer for a new Taylor Wimpey Home in Newport South Wales. I was wondering if anyone has any advice about the level of discount we can expect to receive from this developer?

The house is advertised for circa £280k so obviously stamp duty is a huge expense which would come directly from our deposit.

Would it be best to negotiate a lower asking price and we pay the stamp duty or ask the developer to pay the stamp duty? Any advice would be greatly received.

Thanks

Developers don't like price reductions because it affects the valuation of other houses, so SDLT paid is probably your most likely incentive, or else the government help to buy scheme.

kingstreet

Tancred wrote: »

It's unlikely that any incentive would be more than the 3% SDLT.

We're still seeing 5% builder deposits on some of the sites we have, but these are smaller and around the Midlands.

Not much being given away at the bigger ones.

Tancred

kingstreet wrote: »

We're still seeing 5% builder deposits on some of the sites we have, but these are smaller and around the Midlands.

Not much being given away at the bigger ones.

I hate the idea of discounts anyway. It removes a level playing field and means that some poor bu**er who comes in a couple of months later misses out on an earlier deal that could have saved him £10k etc. Developers only tend to reduce prices or do SDLT freebies on houses that they want to sell quickly, for marketing reasons. Sold houses encourage other buyers to come in and then pay full price for the equivalent house.
This is sharp practice but unfortunately perfectly legal. :mad:

DRP

Tancred wrote: »

I hate the idea of discounts anyway.

You're on the wrong website then!

Tancred

DRP wrote: »

You're on the wrong website then!

You've missed the context of what I said. I was referring to new build properties, not other stuff. :wall:

dgtazzman

Barratt's gave us stamp duty, flooring and turfing/small patio area just over a week ago. They weren't too hot on paying the stamp duty, but we were lucky that there were some other developers across the street with similar properties that were throwing some incentives around like 1k towards legal fees etc. to shift the last few properties they had in a phase of their development. This meant I could refer to these and tell Barratt's if they didn't give me something, I'd be visiting the other developers again that afternoon.

They initially only offered the turfing, but it all depends on the area and circumstances. A price reduction is very unlikely now the market has started picking up. Developers want the 'sold for' prices showing as high as possible as not to adversely effect future sale prices.

Part of me still feels maybe I should have pushed a little harder, but we got around 3.5% - 4% of the asking price in incentives, so there wasn't that much room left for bargaining.

Tancred

dgtazzman wrote: »

Developers want the 'sold for' prices showing as high as possible as not to adversely effect future sale prices.

And they are quite right. I know I would be seriously pi**ed off if I found that my neighbour got his house cheaper and also had SDLT paid for. :mad: