Section 38 - New Build

scholesfan88

Hi guys

Hoping for some help please.

We are buying a new build shared ownership property which is already built. The estate is finished and the developers have moved on to another development close by.

Our conveyancer has flagged up that the road is unadopted. There is a section 38 agreement, but it's not signed or dated and they say they cannot progress matters until this is sorted.

The housing association seem to be raging at this and think we're intentionally delaying everything and want us to instruct our conveyancer to press on without it. However the conveyancer says they'll need to advise the lender, who may then decide not to lend.

Are there any options here other than walking away?

There is circa 100+ houses on the development that are all bought and occupied with just 4 remaining for SO. So I dont understand how they have all bought/mortgaged the houses without the section 38 in place.

Thanks
SF

kazzamunga

In my experience at a housing developer's, the adoption will happen a couple of years after site completion - so if they're still building there I don't see what the issue is? 

kazzamunga

Sorry - so they've finished building but there are still a few people moving in. They should be in contact with the local council about the adoption, and the local council's legal team should draft it up. Have you been in touch with the council's Highways department to see what's happening at their end? You shouldn't press on without it, but I'd be amazed if it wasn't at least in progress, as it's pretty standard fare for councils and developers? 

scholesfan88

kazzamunga said:

Sorry - so they've finished building but there are still a few people moving in. They should be in contact with the local council about the adoption, and the local council's legal team should draft it up. Have you been in touch with the council's Highways department to see what's happening at their end? You shouldn't press on without it, but I'd be amazed if it wasn't at least in progress, as it's pretty standard fare for councils and developers? 

Thanks for the reply.

Apparently it has been drafted up, but hasn't been signed or dated.

kazzamunga

OK I would still speak to the council. 

rachel230

The councils will only adopt if certain conditions are met by the developers. What they * say * will happen  and what actually * does * happen can be two very different things.
Less and less councils are adopting as cheaper for them not to. In those cases owners end up.paying full council tax and uncapped costs to maintain the estate.

scholesfan88

kazzamunga said:

OK I would still speak to the council. 

Just to update, our solicitor has reported the situation to the lender and they have requested indemnity insurance so all is not lost.

Still awaiting a reply from the local council, who frankly are a joke to get hold of.

bucksbloke

Developers often take a long time to provide a section 38 agreement and will typically only do this once construction traffic ceases going over the estate roads. Following that the Council need to complete a snagging list for the developer and everything needs to be fixed before the process begins. This takes time.  You should be able to get a letter of comfort from the developer responsible for the roads.