Garage pushes us over the help to buy limit

houseBuyer93

Hi,

My partner and I have agreed to purchase a new house that is due to be built by March 2022. The cost of the house is £245,000 which is under the £250,000 limit to receive the help to buy bonus (Northern Ireland).

Between our two accounts, our bonus is due to be around £3,500 by March.

However, we also want to add a garage on to the property which would take our valuation of £250,000 and then make us ineligible for the bonus.

I asked our solicitor if it would be possible to get around this by buying the garage separately and paying for it in full (thus our mortgage value of the house would be £245,000) but they have seemed to suggest this wouldn't be possible.

Does anyone have any advice on the above or have you been in a similar situation?

greensalad

Could you ask the developer to sell you the garage for £4,999? 

AdrianC

It seems to be a simple choice...

1. Get the total purchase price under £250k.
2. Miss the bonus.
3. Buy without garage.

Pick one.

One thing's for sure, you can't pretend the garage isn't part of the same purchase, honest. That would be defrauding the HtB scheme. THAT's why your solicitor is saying "nope".

Section62

houseBuyer93 said:

However, we also want to add a garage on to the property which would take our valuation of £250,000 and then make us ineligible for the bonus.

Assuming this would be a garage within your plot (and you'll get the land anyway) then buy without a garage and get one built later if you still want it.

Just check to confirm the situation with planning, and whether the developer will attach covenants to your property preventing you building a garage without their consent.

If the garage would be in a shared block then take into account one might not be available after you've signed on the dotted line for the house.

dimbo61

Explain to the builder your happy to pay £4,999 for the garage and £245,000 for the house.
Your using HTB and you can't afford to pay £250,000

grumiofoundation

houseBuyer93 said:

Hi,

My partner and I have agreed to purchase a new house that is due to be built by March 2022. The cost of the house is £245,000 which is under the £250,000 limit to receive the help to buy bonus (Northern Ireland).

Between our two accounts, our bonus is due to be around £3,500 by March.

However, we also want to add a garage on to the property which would take our valuation of £250,000 and then make us ineligible for the bonus.

I asked our solicitor if it would be possible to get around this by buying the garage separately and paying for it in full (thus our mortgage value of the house would be £245,000) but they have seemed to suggest this wouldn't be possible.

Does anyone have any advice on the above or have you been in a similar situation?

To clarify is this the Help to Buy ISA?

Unless I have missed something the maximum house price is 250,000. its not <250,000 (i.e. max of £249,999.99). Assuming I am correct 245,000 + 5,000 would be fine.

But if not I am sure developer will knock £1 off (or even 1p!!!)

AdrianC

grumiofoundation said:

But if not I am sure developer will knock £1 off (or even 1p!!!)

That depends entirely on demand for those house types on those plots on that development.

If they're flying off the blocks, then the OP will not have much luck in negotiating a discount - which could easily be multiple thousands...

houseBuyer93

Sorry all, I've made this confusing by having a typo.

The value of the house with garage is £260,000 - so a good bit higher than the 250,000 limit.

The only 'solution' I can think of is trying to treat the garage as a separate purchase, so the house price becomes £245,000 and the garage is a separate transaction of £15,000 but our solicitor seems to think this won't be viable.

deannagone

Or negotiate £10k off the price for the garage and house.  Or find another house, or buy the house without garage.

grumiofoundation

AdrianC said:

grumiofoundation said:

But if not I am sure developer will knock £1 off (or even 1p!!!)

That depends entirely on demand for those house types on those plots on that development.

If they're flying off the blocks, then the OP will not have much luck in negotiating a discount - which could easily be multiple thousands...

You are right - clear now 250k not the price 'agreed', so discount asking for is 10,000

[I was (incorrectly) working on the assumption 250k had been 'agreed' and OP wanted to get to below 250k]

grumiofoundation

deannagone said:

Or negotiate £10k off the price for the garage and house.  Or find another house, or buy the house without garage.

or sacrifice HTB bonus.