Have I made a mistake purchasing a London new build?

lincroft1710

economic wrote: »

does not mean it will continue. also its an ex-council which were always cheaper anyway.

the OP bought a new build in an average area in zone 2. also he bought a 1 bed. in terms of invesment i would never have bought it, there are better investments in london if i were buying another. of course if the OP bought it as a home then fine its a perfecttly reasonable purchase.

Although ex council it is a lowrise infill in a good area. IMHO a property purchased to live in, should not be regarded as an "investment", so I agree that as a home it is a reasonable purchase.

jimbog

martinsurrey wrote: »

https://forums.moneysavingexpert.com/discussion/5029003


Eventually there will be a correction, and Crashy will claim to have been right all along

True. Even a broken clock tells the right time twice a day

boliston

economic wrote: »

was it a 1 bed? if so then i agree, i think the OP is over paying. i know nicer areas 1 beds new build go for similar price.

Are these "nicer areas" by any chance further away from central london?

economic

boliston wrote: »

Are these "nicer areas" by any chance further away from central london?

no still zone 2/3

sturgeon

From some quick research I presume you're buying at Clissold Quarters? The prices there do look expensive (£525k is laughable for a one bed, looking at the area on Google Maps in the vicinity of the flashy new block it looks pretty horrible). I know you paid £460k. There are far better developments in London you could have bought a lovely new build at, i.e. around the Docklands (Royal Wharf for instance).

However, the London market is different and I generally have seen no evidence that new builds devalue. It comes down to making a very informed, careful, sensible purchase. If you're an idiot and you pay full price for a new build flat, and have no comparables in the area that have a remotely similar value, then yes you're likely going to see no value increase for a very long time.

If you buy close to when the sales suite opens, negotiate hard on the price and you're as sure as you can be that other recently built 1 bed flats in the area are selling for more than £460k already then you're making a better bet.

My last new build was in zone 4, bought in 2009 and it sold for almost 170% what I paid for it early last year. My latest new build, a 2 bed flat I bought off plan mid-2015 for just under £400k in zone 4 (completed late last year) and looking at countless comparables I could easily sell now for £45k-50k more, with £60-80k achievable next year/early 2019. And I actually could have bought it earlier in the developer sales process if I came across it sooner, and paid less.

To be fair, my comment above about the local vicinity is a bit hypocritical as some areas very near my flat are an absolute dive. Yet, there's an M&S opening downstairs in a few months, lots of other retail and it's in a £5bn London regeneration zone. Sometimes you need to 'invest' a few years before the area thrives. Same applies to where I was renting (and what I refer to above in the Docklands), early adopters bought 1 beds for £250k which are now selling for £100k more only 3 years later, 2 beds have inflated even further.

Oh and I know Help to Buy inflates the market, but who cares-you're not going to get anywhere sitting around renting so why not take the equity loan and hopefully enjoy the profit you'll make from selling the property on in 5 years before you need to pay a penny of interest on the loan?

Basically, as long as you are clearly sensibly looking at the purchase of your new home as an investment, and did all the due diligence at the time, I wouldn't worry too much. If you really, really think now that you've paid massively over the odds then consult your solicitor and see if you can 'flip' the property by selling your contract to someone else. Or create some extenuating circumstances, try your luck and pull out-as you say they'll gladly resell it for £60k more than you paid.

warehouse

OP I bought my first place, a one bedroom flat, on the outskirts of London in 1988, (just as the bubble was about to burst). In 8 years of paying a stupid % on my mortgage I lost £11K when I sold it. My next place, a 3 bed end of terrace, I bought when I sold the flat so at the bottom of the market, and made an absolute bundle when sold it in the peak in 2006.

So don't concern yourself too much, once you're on the property ladder, especially in London, then long term you're laughing.

autoumobile

just look around maybe you we see new development compared to the other

movilogo

Don't worry, in 5 years time an Arab Sheik or Russian oligarch will buy your 1 bed flat for £1 million

Crashy_Time

jimbog wrote: »

True. Even a broken clock tells the right time twice a day

At least we have got to the stage of accepting there will be a correction That would have been a stretch for many people`s imagination`s even a couple of years ago.

boliston

sturgeon wrote: »

From some quick research I presume you're buying at Clissold Quarters? The prices there do look expensive (£525k is laughable for a one bed, looking at the area on Google Maps in the vicinity of the flashy new block it looks pretty horrible). I know you paid £460k. There are far better developments in London you could have bought a lovely new build at, i.e. around the Docklands (Royal Wharf for instance).......

That Royal Wharf area looks a bit barren and windswept to me although some people might love it. You are kind of hemmed in/cut off on both sides by huge docks and the river. The Clissold site is not directly on a particularly appealing road but there is a Piccadilly line tube and a street with various shops etc a couple of blocks away.