New Build Price Release DISASTER

Jamlee

In May I placed an Early Bird reservation on a new build house, the site agent advised us the last house of this type sold was 162,000 and it was expected to rise by 5k in the next release which is the house we were hoping to get. We didnt hear anything of a final price for months and then this weekend they finally got back to us to say the release price of the house is 192,500... 30,500 more than the last house sold which is only a few doors down the street!! We have had our hearts set on this house but 192k is way above our budget, is there anything we can do to get the builder to drop the price? Are they even allowed to raise the price so high?

We went to visit other builders today and they were shocked at the increase, apparently it is usual for a house to be released at an extra 1 or 2 thousand each time but is there any rule stopping them raising it by 30,500?

Help! Waiting for a call back from head office on monday and need ammunition!

elsien

Supply and demand. They can ask whatever they think people will pay for it. Whether anyone thinks it's actually worth that is entirely different.
If it doesn't sell then they'll drop the price back down again.
Just don't let them panic you into paying more than it's worth if they come back on Monday with a slightly lower figure.

gardner1

Move on and find something else

Comms69

Jamlee wrote: »

In May I placed an Early Bird reservation on a new build house, the site agent advised us the last house of this type sold was 162,000 and it was expected to rise by 5k in the next release which is the house we were hoping to get. We didnt hear anything of a final price for months and then this weekend they finally got back to us to say the release price of the house is 192,500... 30,500 more than the last house sold which is only a few doors down the street!! We have had our hearts set on this house but 192k is way above our budget, is there anything we can do to get the builder to drop the price? Are they even allowed to raise the price so high?

We went to visit other builders today and they were shocked at the increase, apparently it is usual for a house to be released at an extra 1 or 2 thousand each time but is there any rule stopping them raising it by 30,500?

Help! Waiting for a call back from head office on monday and need ammunition!

I don't understand why you think a private company should be restricted on the price they want to sell an asset for, in a private transaction?

PasturesNew

Tell them to stuff it - if you had £192k you'd have reserved an £192k house earlier in the year.

In your position you can do nothing except tell them to stuff it and hope they come back cap in hand in 3-4 months' time offering it at the lower price as nobody'd buy it at the high/new price.

Jamlee

Does a house not need to be valued by a surveyor before it can be sold though? How can a house down the street be valued and sold at 162k and then the next identical house be valued at 192k?

PasturesNew

Jamlee wrote: »

Does a house not need to be valued by a surveyor before it can be sold though? How can a house down the street be valued and sold at 162k and then the next identical house be valued at 192k?

A house is valued by a surveyor if you need a mortgage. You can pay what you want to if you're waving cash.

A surveyor will look at local market movements and what else has sold locally that's similar.

It might be that a mortgage company surveyor will laugh as he writes down £162k.... but if the market HAS moved that much then he'd write £192k.

There is no such thing as a "house valuation" - there is just "this house, today, compared to similar houses close by that have sold recently" ... which might or might not include the one next door.

Valuation is not an exact science. It depends, in part, on the lender's current attitude towards the marketplace and how safe their money might be if they lend.

But if a bus full of cash buyers headed out to that development waving their cash about, that developer can pick his price.

Bossypants

Jamlee wrote: »

Does a house not need to be valued by a surveyor before it can be sold though? How can a house down the street be valued and sold at 162k and then the next identical house be valued at 192k?

A surveyor in an independent expert whose job it is to provide their opinion as to the appropriate price given the details of the house and taking into account local market factors. Mortgage lenders and cash buyers alike set a lot of store by the opinions, but there is absolutely nothing to stop the vendor from pricing it at £10,000 or £100,000 more than the surveyor opines the value to be. They'll just likely struggle to find a buyer.

Jamlee

A house is valued by a surveyor if you need a mortgage. You can pay what you want to if you're waving cash.

A surveyor will look at local market movements and what else has sold locally that's similar.

It might be that a mortgage company surveyor will laugh as he writes down £162k.... but if the market HAS moved that much then he'd write £192k.

There is no such thing as a "house valuation" - there is just "this house, today, compared to similar houses close by that have sold recently" ... which might or might not include the one next door.

Valuation is not an exact science. It depends, in part, on the lender's current attitude towards the marketplace and how safe their money might be if they lend.

But if a bus full of cash buyers headed out to that development waving their cash about, that developer can pick his price.

Thank you for the explanation, that actually all makes perfect sense, I didn’t realise a valuation wasnt needed for a cash buy.

dimbo61

Well your trying to buy a new build ( not help to buy I Hope ?)
Your going to be paying 10/15 and maybe 20% more than other OLDER houses in the area.
Nice New kitchen and bathrooms with lovely new deep pile carpets.
We have recently bought a 20 year old house and the same size property being built on a field next to us are £70/90,000 more expensive for the same size house.
Don't get mugged

Tom99

[FONT=Verdana, sans-serif]What is an Early Bird reservation? Did you have to pay for that and exactly what benefit did it give you?[/FONT]