Reserving a Help to Buy property

alisonken

My husband and I want to sell our shared ownership flat (just in the process of getting it valued) and buy a larger house through HTB. We've been told we'll qualify for the scheme and have been given an indicative mortgage quote.

However, the developer will not allow us to reserve the house we want until our flat is sold subject to contract. The house will not be finished until April.

Our housing association requires an 8 wk window to try to sell our flat, after which we can go to open market - a local estate agent has assured us based on our area/demand that it'd easily sell within a week.

Understandably, though, we don't want to have to wait all that time, sell our flat but then have the house not be available.

We thought it was a bit odd not to be allowed to reserve, so checked with the local HTB agent, who were pretty clear that the sale of our flat needs to go through by the time of *exchange* but that we should be able to reserve. We'd clearly be able to sell our flat by early March, well in time.

Does anyone know how much discretion the developer has, given that HTB is obviously a national scheme? Or do they have to do what the agent says?

kingstreet

The builder will want you to exchange contracts within 28 days and you can't do that unless you can exchange contracts on your sale at the same time.

This isn't about HTB it's abut you not being in a position to commit to the purchase. This prevents the builder kitting out the house to your spec. They don't do that until after exchange of contracts.

alisonken

Completely understand that rationale - does just seem a little odd that they effectively expect you to leave yourself high and dry...

kingstreet

In my experience, as a newbuild mortgage broker, they don't.

All they expect is that you have a sale sufficiently progressed that you can exchange contracts within 28 days, so you fit their build schedules and don't risk them fitting out a property to your spec they then have to sell cheaply to someone else because you aren't in a position to proceed. If that isn't possible, they won't take the reservation.

Take the newbuild aspect out of it. If you made an offer on any house in your current position, you'd be considered unproceedable and the property left on the market until you get a buyer and become proceedable.

Either way, you need to find a buyer for yours, before you are going to be taken seriously.

brit1234

I think it is more down to your shared ownership property. They are well known for being harder to sell than normal. The builder probably knows it and that is why they are protecting themselves.

alisonken

Thanks for the explanation - I think it would have helped if they had actually explained this rather than just repeating 'you have to sell your flat before reserving'! Obviously we just don't want to end up in the position of accepting an offer on the flat and then finding out the house has also gone. I'd say that's quite a likely situation with one house available and potentially two months to wait to sell. We could wait for the release of the second phase on the development but we'd have to be a bit cannier with timings on selling - otherwise we might have to rent in between, which obviously we'd like to avoid if possible!