Land Registry Purchase Price - New Build

ajay87

Hello all, I'm after some advice from someone with knowledge (ideally legal) of land registry purchase price information.

I bought a new build house 2 years a go from a house builder. The purchase price was £142,500. As an incentive we we're given a 5% gift (£7125) towards our deposit. This was sold to us as a gift towards our deposit, and told it was not possible to reduce the purchase price instead - thus reducing our mortgage amount needed.

Anyway, looking at the land registry, the purchase price of the house has been noted as £135,375 (the purchase price - builders gift). Now this may be a simple answer that this is the usual way of declaring the purchase price, however I'm under the impression that it should still be the £142,500 on the purchase price. Either that, or our mortgage is based on a false amount?

Where do I stand. Thanks for any advice!

w00519772

i am a first time buyer. I found a house i liked for 150k late last year. The problem was that two identical houses sold for £125k. I believe it was due to the same reason. Down prices all houses on that road. That is not fair in my opinion.

lincroft1710

It is your solicitor who notifies the Land Registry of the price you paid for your home.

If the builder "gifts a deposit" then that is just a way of reducing a house price, without actually appearing to do so. But the net amount you paid was £135,375, so it is debatable that the price has been incorrectly recorded.

ajay87

Thanks for the replies. I'm going to follow up and try and get some proper legal advice, however I was expecting it to reflect the purchase price, which was £142,500, as thats what our mortgage is based on, and the 5% was sold as 'a gift'.

Land_Registry

Hi ajay87

What lincroft1710 says is right.

When the purchase price includes a discount or cashback, as in your case, itis our practice to put the lowest or net amount shown to have been paid, as theprice paid on the register

harrys_dad

You paid £135.375 so that is what appears. You seem to have been "lucky" that your mortgage company didn't know/didn't find out/were not informed as the lower figure is what should be the basis of your loan to value calculation.

ethank

Land_Registry_representative wrote: »

When the purchase price includes a discount or cashback, as in your case, itis our practice to put the lowest or net amount shown to have been paid, as theprice paid on the register

If this is the case why do builders insist on gifted deposits rather than a price reduction? Many builders don't want to reduce the price because of the impact it will have on future prices.

Land_Registry

Discounts and incentives vary considerably so from a registration perspective it is important to at least be aware that they can and do happen.
Others may be able to offer an answer though based on their knowledge or expertise of course.