Exchanging without completion date

LigerMule

We had an offer on our house prior to COVID, and reserved a plot at a new development. Our solicitors have been very slow to get everything prepared for exchange, but we finally got there. However, we are now two weeks away from the proposed completion date (been given this both verbally and in a written email to our solicitor) and the builder won’t exchange with a completion date (with “serve notice” only) until a warranty certificate has been issued. We were told they would have the certificate a couple of days ago, but the building work was not complete enough for this to happen, and won’t be until the end of the week. This leaves us at 7 days until the proposed completion date! Our buyer has said they won’t exchange without a completion date, but are happy to wait until the end of the week to exchange contracts (although I’m unsure that gives them enough time to request funds?). They have been pretty understanding with the whole situation, but they have stated that they must move by the proposed completion date. I think the sale of our current home may fall through if we go beyond that.

We wondered if exchanging with our buyer with a date, then exchanging with the seller without a date is a good idea, or are we leaving ourselves too vulnerable? We could move in with family short term (maximum a couple of weeks) but this would be very worst case scenario, as we have two young children in what would be a small house. Also I’m not sure how well my partner would cope with that! Is this is the best way to ensure that everything goes through, or is it better to wait until we have a warranty certificate and a completion date from our builder?

Thanks very much for reading!

iwb100

Ermmm it sounds like your house isn’t built yet...
Your buyers are ready to exchange and complete on your house but you cannot move into your new house because it’s not ready. First you need to ask the developer when your house will be ready to complete on and move into. This may be a few days after the proposed completion date in which case I’m sure you can negotiate with your buyers.

if it is longer then your options are a) persuade your buyers to wait....b) sell to your buyers and rent or whatever till yours is ready c) hope your buyers hang around till you are ready...

Our solicitors wouldn’t let us exchange ahead of completion in COVID world, in fact they said under no circumstances would they do that, whole chain was told the same by different conveyancers too. Still would need a target completion date agreeing which means you need to find out when your property will be ready...but gets around the developer not wanting to exchange with a date.

eddddy

It sounds like you understand all the risks - so it's up to you how much of a risk you're willing to take.

Presumably, if you move in with family, you'll have to arrange storage for your furniture - plus two lots of removals.

There's also the risk that the new house fails it's final NHBC inspection, so no certificate is issued and it needs months of rectification work (but that's probably unlikely). But you need to think about what 'long-stop' date you want in the contract.

Thrugelmir

Proposed completion date is just that proposed. As you've experienced nothing can be set in stone until actual events unfold. A new completion date can be agreed between all the parties once it's appropriate to do so. 

LigerMule

Yes, it is possible. I believe it’s fairly common for new builds? They can issue a “long stop” contract where they serve notice to their buyer closer to the completion date, but if they fail to complete within an agreed, longer time-frame it is no longer valid.

 

LigerMule

The above was in response to Micky, by the way!

LigerMule

Just reading through some of the replies now, thanks for responding.

eddddy

Mickey666 said:

Is it even possible to exchange contracts without a date?  

Yep - it's very usual with new builds.

iwb100 said:

First you need to ask the developer when your house will be ready to complete on and move into. 

Presumably, the builder cannot be 100% sure. Not least because it has to pass the NHBC final inspection before completion can occur. 

iwb100

eddddy said:

Mickey666 said:

Is it even possible to exchange contracts without a date?  

Yep - it's very usual with new builds.

iwb100 said:

First you need to ask the developer when your house will be ready to complete on and move into. 

Presumably, the builder cannot be 100% sure. Not least because it has to pass the NHBC final inspection before completion can occur. 

They might not know the date but they know how far along the build is....do you know where build is up to? 

eddddy

iwb100 said:
They might not know the date but they know how far along the build is....do you know where build is up to? 

The OP says:

LigerMule said:

We were told they would have the certificate a couple of days ago, but the building work was not complete enough for this to happen, and won’t be until the end of the week. 

So it's likely to be issues like 'the electrician didn't turn up for a couple of days last week' or 'the plumber dropped the toilet cistern, and we're waiting for a new one to be delivered' or 'the kitchen supplier delivered the wrong colour worktop' or 'the ceiling in the bathroom is bumpy and needs re-plastering, but all the plasterers are busy on other sites'.

And the builder can't be sure whether it will take 2 days, 7 days or 14 days or 21 days to get the issues fixed, and to arrange an NHBC inspector's visit.

LigerMule

Not been inside the property for around three weeks, but things looked promising at that point. The kitchen was starting to be installed and the bathrooms fitted. My husband drove on site today and from the outside just appears to be the fencing, garage door and driveway. 

The builders keep promising us we will be moving on this date, we have booked a home demo for two days prior. We will be on the phone on Monday chasing, and it is quite possible that we could ask to go inside also to check on progress.