Part Exchange Advice

hugh1964

Ihave reserved a new house that will not be built for what looks like a considerable amount of time.

The builder have now contacted offering a plot that will be completed in the very near future, and as it is as yet unsold, want to discuss PX - this is not a standard practice by this builder. Usual script, 2 valuations will be done, then a fair market value offer etc. I am fully expecting this to be way below the open market value of the house.

Where I am with this, the builder needs to shift this house very quickly, like 2 months time max, and from what I can see me moving here is the most realistic option they have for a successful completion in that time. There are reasons for that no doubt - end of financial year, one of the first houses to be completed will be unoccupied, releasing capital etc. Honestly, I was all set to wait the additional time - able to build more funds, current mortgage reduction, current property appreciation etc - so I can be patient and walk away if need be.

I need some advice on what I am likely to be able to negotiate here. Stamp duty paid (not an insignificant amount of money, trust me)? Turf? Carpets? Cashback? The 5% rule is in place here which I need to be careful of. What I am not keen on is a reduction in the purchase price as in reality this is of less real world value as SD paid, or cashback. And things like turf are not expensive, and carpets also not that interesting a perk - unless I can get to a place where I get all of that! Yer, right!

Any advice on what my approach should be here?

H

Kell4life

Depending on the developer, I would think its unlikely that you'd get stamp duty paid on top of a part exchange, often with part exchange they will give you nothing more, you have more chance with upgrades and extras. I would suggest going in with an offer of stamp duty, and all the extras you want and see what they say, you can possibly increase your offer if need be.

hugh1964

Thanks for that. I feel this scenario is different to other PX stories I am reading, or at least the majority of them. The house I have will sell on the open market no problem, shifting houses in my area is not a problem. The builder is the one pursuing me to do a PX, not vice versa, and as I say I am perfectly prepared to wait. I guess I'll find out in due course.

Kell4life

In that case I'd start negotiations with the developer, I'd propose you go in with the offer you want such as stamp duty paid and any extras, possibly even more. They are likely to say no (but you never know they could say yes) it's a good starting point, you can increase your offer if you are happy to until you can come to an agreement. I'd have a limit in mind to what you'd agree, and would walk away if you can't negotiate a deal you are happy with.

The on site sales person won't have the authority to agree on a deal like this, it would likely have to go higher up the chain to the regional manager and it can take several days of waiting to see if it would be signed off.