NEW BUILD HOUSE VALUATION AFTER COMPLETION AND COVID19 IMPACT

pawymae

"The major issue here for buyers is that mortgage lender property valuations are usually undertaken at the beginning of a new build and after construction is completed. If property prices fall within that period, therefore, and the buyer is unable to secure a mortgage for the remaining balance (due to a perceived reduction in security for example), then the deposit will be lost due to breach of contract." 

Hi Guys, 
I hope everyone is well. 
My husband and I are waiting for the exchange of contracts with Bovis and the house completion will be in September 2020. We also have our mortgage offer and the house was low valuated and Bovis already agreed to lower down the house price by 20k.
But we are now concern about how Natwest will carry property valuation upon completion of the construction and COVID19 impact on house prices. Could someone help us to confirm and advise on the following:
1. Will Natwest have to carry again another valuation upon house completion?
2. Any suggestion on what will be our other options if house price falls due to COVID19.

Thank you and stay safe everyone. 

Davesnave

The short answer is that nobody could have predicted the current situation and financial prospects with any accuracy a couple of months ago, so how will anyone here be sure what the situation might be and what measures will be in place to cope with them 5 months on?

GDB2222

I would not exchange contracts now for completion in September. Simple  as that.  There’s far too much scope for things to go wrong. Some people are now exchanging and completing on the same day, despite the obvious inconvenience, as that way there’s no risk of losing their job/mortgage between exchange and completion. 

davidmcn

pawymae said:

My husband and I are waiting for the exchange of contracts with Bovis and the house completion will be in September 2020.

(a) why are you wanting to exchange in the near future given all the uncertainties?

(b) newbuild completion dates tend to be optimistic at the best of times, they're even more meaningless now.

steampowered

Mortgage offers are generally only valid for 6 months.

Personally I wouldn't be exchanging right now, especially if I couldn't be sure that a mortgage would be available upon completion.

csgohan4

don't forget construction is on hold, so that completion date of sept will likely be pushed back