Advice on buying a new build home October 2022

don-aldinho

Looking for some input - perhaps you have had a recent experience that may help us.

We've reserved a new build home in a village near us with Cala homes - good builder, and in the area, we want for schools etc etc.

We've got our Mortgage agreement set (reasonable ish rate...not brilliant), our home is sold but we have not signed missives on the cala property yet. I believe we're in a good position to potentially re-negotiate with the builder

When we reserved back in August, they were very clear on no negotiations and no incentives. Yet, with the mortgage market being so chaotic recently, the builder has been very amicable and are now no longer 'pushing' us towards quickly signing our missives...in fact, contact has been minimal at best.

our concern is if we renegotiate, we lose the home in the area we have been trying to move into for over a year, in the home we want. YET...i firmly believe the market is on a wobbly stool right now.

WDYT? Is anyone in a similar position with some advice?

RM_2013

From what I’ve read usually there is less room
for negotiation on a new build but the market has definitely changed.  For example there is a developer locally selling plots that would usually get snapped up instantly and they appear to be struggling to sell any despite offering incentives and deposit boosts etc 
How is the rest of the development progressing? Have they sold the other plots? If it’s one of the last plots usually there is some
room for negotiation.
is there a sales office that you can chat with to put the feelers out? 

Good luck and let us know if you managed to reach negotiate or get any incentives added on

smipsy

Depends on your area. My partner works for a developer in the NW (anecdotal, I know, but it's very recent, so could be an insight), and they are still adamant there are no renegotiations to go for. However, they have a few lots still outstanding which was not planned in their business plans.

So they have now started throwing in incentives, help with deposits and just pure cashbacks as well, which they were also adamant against a few months ago. I don't think (at least in NW) that the majority is ready to go straight for negotiating prices down, but I don't think it's too far off.

In my partner's case, the contingency is "open for negotiations" by end of October, and price drops/offers by mid-November.

So my advice would be to wait if you can afford to do so, and then see how your luck plays out.

don-aldinho

smipsy said:

Depends on your area. My partner works for a developer in the NW (anecdotal, I know, but it's very recent, so could be an insight), and they are still adamant there are no renegotiations to go for. However, they have a few lots still outstanding which was not planned in their business plans.

So they have now started throwing in incentives, help with deposits and just pure cashbacks as well, which they were also adamant against a few months ago. I don't think (at least in NW) that the majority is ready to go straight for negotiating prices down, but I don't think it's too far off.

In my partner's case, the contingency is "open for negotiations" by end of October, and price drops/offers by mid-November.

So my advice would be to wait if you can afford to do so, and then see how your luck plays out.

Thanks

its in Scotland. Other plots ARE being reserved but MUCH slower than earlier. There is no sales office yet as this is still the first few homes, they were releasing 3-4homes at a time, now it appears to be just one at a time. That said…plots have not stayed available for long, but there are two that have been up for grabs for a few weeks now.

our gut instinct was to wait it out a little to see how we go, I think your partners experience her has bolstered that position.

thanks so much folks 🙌🏻🙌🏻🙌🏻

pinkteapot

don-aldinho said:

our concern is if we renegotiate, we lose the home in the area we have been trying to move into for over a year, in the home we want. YET...i firmly believe the market is on a wobbly stool right now.

WDYT? Is anyone in a similar position with some advice?

Why would you lose it?

You ask the developer to drop the price, they say no, you say 'oh well' and continue with the purchase anyway? They're not going to say "Right! Because you dared ask I refuse to sell to you." There's a slim chance a private seller would do that, if you've got a bit of looney who can't keep emotion out of house selling, but there's no way a builder would. 

Unless you mean you're definitely not happy to pay the agreed price anymore?

Also... Instead of negotiating on price, you can try to get more optional extras thrown in free. Certainly in England - I don't know about Scotland - that can be a better bet. The builder doesn't want low 'sold' prices appearing online while they're still trying to sell the new houses from later phases, hence not wanting to drop price. But optional extras cost them peanuts and they sell them for huge mark-ups, so they've got flexibility there. 

Sarah1Mitty2

pinkteapot said:

don-aldinho said:

our concern is if we renegotiate, we lose the home in the area we have been trying to move into for over a year, in the home we want. YET...i firmly believe the market is on a wobbly stool right now.

WDYT? Is anyone in a similar position with some advice?

Why would you lose it?

You ask the developer to drop the price, they say no, you say 'oh well' and continue with the purchase anyway? They're not going to say "Right! Because you dared ask I refuse to sell to you." There's a slim chance a private seller would do that, if you've got a bit of looney who can't keep emotion out of house selling, but there's no way a builder would. 

Unless you mean you're definitely not happy to pay the agreed price anymore?

Also... Instead of negotiating on price, you can try to get more optional extras thrown in free. Certainly in England - I don't know about Scotland - that can be a better bet. The builder doesn't want low 'sold' prices appearing online while they're still trying to sell the new houses from later phases, hence not wanting to drop price. But optional extras cost them peanuts and they sell them for huge mark-ups, so they've got flexibility there. 

Yes, that makes perfect sense, they are not going to be petulant and emotional like some sellers who are fixated on a certain price, they are hard nosed business people, but if you think the market has changed (most people do) then you need to balance losing money on a future sale with how much you want or need to live there in my opinion.

SarahB16

pinkteapot said:

But optional extras cost them peanuts and they sell them for huge mark-ups, so they've got flexibility there. 

What optional extras are you thinking please?  

koalakoala

You can often get flooring/blinds etc

dottydoo212

It depends on the demand for the properties. My property was undervalued by £20k and the bank asked me to negotiate the costs down but the vendor wasn't having any of it and was very confident that if I didn't either find an alternative lender or cover the shortfall they wouldn't have an issue finding someone else.

It's always worth asking though, they can only say no. Also, I doubt the reduced figure on the property would cause any significant delay in regard to your mortgage.

don-aldinho

re:options

Flooring/LBTT (Scottish Stamp duty) help would be ideal in our circumstance tbh 

we’ve a face to face appointment tomorrow to look at kitchen options so perhaps we will be able to cha through some options

SarahB16

don-aldinho said:

re:options

we’ve a face to face appointment tomorrow to look at kitchen options so perhaps we will be able to cha through some options

One thing I always wonder is if you are in the position of discussing kitchen options with a housing developer whether instead of having a dishwasher (something I don't have and never want) if the space could be used to accommodate an additional (below the counter size) freezer instead?