Help - mid new build first time purchase

Crashy_Time

robtam said:

Cheers everyone - update I have called the builders explained my concerns. She explained as I haven't exchanged I'd get my £500 reservation feed back. Interestingly from her perspective house prices won't drop any time soon ... not sure what planet she is on. However, I explained my two options are: 
i. Withdraw and get my £500 back
ii. Enter renegotiations with house builder to mitigate my concerns about volatility of house market - given lock down x2 and unemployment rising. 

Realised I may get my heart broken - but better that than break my bank with negative equity etc

She is on planet "I work for a company that is looking at big losses in the near future".

robtam

Crashy_Time said:

robtam said:

Cheers everyone - update I have called the builders explained my concerns. She explained as I haven't exchanged I'd get my £500 reservation feed back. Interestingly from her perspective house prices won't drop any time soon ... not sure what planet she is on. However, I explained my two options are: 
i. Withdraw and get my £500 back
ii. Enter renegotiations with house builder to mitigate my concerns about volatility of house market - given lock down x2 and unemployment rising. 

Realised I may get my heart broken - but better that than break my bank with negative equity etc

She is on planet "I work for a company that is looking at big losses in the near future".

Any tips on how to conduct negotiations in this climate? 
Thanks
R

steampowered

I think a 1-bed, new build, premium priced flat in Zone 2 is exactly the kind of property that is likely to be hit by price swings. More so than other properties at the same price point. It's a premium priced property, but not in a super-prime area, with a new build premium attached.

Furthermore - the risk of price swings is much higher for someone who is buying with a  small deposit and with a HTB loan. If you have a 95% mortgage, and house prices drop by 5%, you'll be in negative equity - unable to move and paying through the nose on a high rate, unable to remortgage.

In your situation I would probably not proceed to exchange.

robtam

steampowered said:

I think a 1-bed, new build, premium priced flat in Zone 2 is exactly the kind of property that is likely to be hit by price swings. More so than other properties at the same price point. It's a premium priced property, but not in a super-prime area, with a new build premium attached.

Furthermore - the risk of price swings is much higher for someone who is buying with a  small deposit and with a HTB loan. If you have a 95% mortgage, and house prices drop by 5%, you'll be in negative equity - unable to move and paying through the nose on a high rate, unable to remortgage.

In your situation I would probably not proceed to exchange.

Would you consider trying to negotiate down the asking price?

Thrugelmir

robtam said:

Cheers everyone - update I have called the builders explained my concerns. She explained as I haven't exchanged I'd get my £500 reservation feed back. Interestingly from her perspective house prices won't drop any time soon ... not sure what planet she is on. 

Either you wish to proceed or not. As a business they are in no better position than you to predict the future. They might as well sit on their hands for the time being. 

robtam

Thrugelmir said:

robtam said:

Cheers everyone - update I have called the builders explained my concerns. She explained as I haven't exchanged I'd get my £500 reservation feed back. Interestingly from her perspective house prices won't drop any time soon ... not sure what planet she is on. 

Either you wish to proceed or not. As a business they are in no better position than you to predict the future. They might as well sit on their hands for the time being. 

Thanks I do want to proceed but want to re-open negotiations. I'm very happy if they don't want to. I'll walk.... she can sit on her hands - imagine her company could face quite harsh conditions going forward so may want a quick sale as I have a mortgage/solicitor/ survey all done.... their choice ultimately. 

Crashy_Time

robtam said:

Crashy_Time said:

robtam said:

Cheers everyone - update I have called the builders explained my concerns. She explained as I haven't exchanged I'd get my £500 reservation feed back. Interestingly from her perspective house prices won't drop any time soon ... not sure what planet she is on. However, I explained my two options are: 
i. Withdraw and get my £500 back
ii. Enter renegotiations with house builder to mitigate my concerns about volatility of house market - given lock down x2 and unemployment rising. 

Realised I may get my heart broken - but better that than break my bank with negative equity etc

She is on planet "I work for a company that is looking at big losses in the near future".

Any tips on how to conduct negotiations in this climate? 
Thanks
R

Don`t conduct any negotiations in this climate would be my advice, let the developer sweat, don`t give them an opportunity to hit you with sales patter like "house prices won`t drop any time soon"!

robtam

Just wanted to give everyone an update from the developer after I sent an email trying to reopen negotiations: 

I do hope you are well,

 

It was lovely to speak to you at the weekend.

I have spoken to my Director and we are unable to offer any incentives I am afraid.  

To reassure you we are still reserving plots yesterday we reserved 2 more.

Exchanges and completion are still going through just taking a little longer.

Please let me know your decision and if you feel the time isn’t right for you to proceed and we will refund you reservation fee.

 

Please take care, if you have any further questions please don’t hesitate to contact me.

numbercruncher8

What development is it?
I've seen 1-bed ex-new build flats on the market for £350k in Zone 2 but may not be comparable in terms of location.... Zone 2 is a big area. Perhaps compare the prices of these. There should be many around. 
Personally I'd be inclined to call their bluff. 

robtam

numbercruncher8 said:

What development is it?
I've seen 1-bed ex-new build flats on the market for £350k in Zone 2 but may not be comparable in terms of location.... Zone 2 is a big area. Perhaps compare the prices of these. There should be many around. 
Personally I'd be inclined to call their bluff. 

It’s between Bethnal Green and Whitechapel - Higgins Home