New build reserved, now selling to others

karenlouisee

Any insight or advice appreciated.

We reserved a new build property, paid £500 fee, was told reserved for 12 weeks, but not to worry as “we are flexible even if you don’t sell it in the 12 weeks”. Only 4 weeks on we have had an offer on our house, put in our mortgage application, paid for valuation, developer called us today saying “sorry, someone has been to the MD and made an offer that’s been accepted, so you can no longer have the house”
Have reservation paperwork, only states date of reservation, no time length time of reservation etc. No t&c or disclaimers etc.
So, we will lose sale of our home, lose £250 valuation fee, £200 mortgage advisor fees, and more importantly our dream home.

Do we have a leg to stand on here?

00ec25

what does it say on the reservation paperwork?

No builder is going to take money without having explicit terms and conditions about what that money covers

being told something is irrelevant, what is written down is what matters

LittleMax

It must have something printed on it - what makes it reservation paperwork if it has nothing printed on it? You make it sound like it's the date written on a piece of plain A4 paper!

karenlouisee

It details the plot name address, reservation fee £500. Reservation expiry date: exchange date.
Purchase price valid until: completion date.

karenlouisee

No small print t&c if you see what I mean. Only details they will keep 50% of the deposit if we cancel the purchase.

Dolly123

Was it a Mastermove/Smoothmove kind of reservation?

karenlouisee

No I don’t believe it was a master/smooth move

They are usually quite flexible with people on reservations, they are a fairly small local company not national, for example the house was previously reserved for 6 months before the buyers pulled out. Which is why it’s even more annoying to have only had it reserved for 4 weeks before they are attempting to sell it on to someone else, when both ourselves and our buyers Already have mortgage applications in progress, in fact 2 weeks ago the developer provided necessary paperwork to our mortgage advisor that he needed to show it had been reserved.

Certainly bad practice, but whether I can enforce the contract I don’t know.

Marvel1

Do you get the £500 reserve fee back as you did not drop out they did?

Assuming like any other house purchase, anyone can drop out before exchange without penatly.

LittleMax

Nothing like NHBC form then?

karenlouisee

I presume we would get it all back yes.

Not like the NBHC it seems, that looks like would have made things more straightforward.

Silvertabby

We bought nearly 25 years ago, also from a smaller builder.

Initially, we were told that the house we wanted was already reserved, but they took our contact details in case anything changed.

We then had a phone call from them to say that the original buyer had mis-lead them in that he hadn't even had an offer on his own house - and as he almost certainly wouldn't be able to complete by the due date, his reservation had been cancelled.

We then down put our £100 reservation fee - on condition that we HAD to complete by a certain date.

We were ok as we were living in Armed Forces married quarters at the time - but it must have been stressful for anyone who had had to sell.

I did wonder if the builders did that because they knew that we didn't have anything to sell - but sounds like it's still normal practice with smaller builders. Cash flow, perhaps?