New Build Flats - Any good???

2bFrank

Hi All,

Some advice needed. Me and my girlfriend are first time buyers and are looking for our first home. At the moment we are quite priced out of all the good areas, however an oppotunity has risen that may assist us on getting on that first rung. We have been on our local councils affordable housing scheme list for a year now and finally we are at the top and been offered a new flat in a good area. The flat will be shared equity and as extremely very affordable for us. The problem is, its a new build flat. I have heard some very mixed feeling about the quality of build, and a mate has one and has endless problems (flat screen tv falling off walls and even holes appearing in the walls.) I would like to know what you guys think and any expereinces you have had.

The flat is a great price for us, but if the new builds are crap then there is not much point going for it.

neilp

My first reaction (I'm also a potential FTB, but waiting to see what the market does) would be to have a look at it, not rule it out, but be very careful about proceeding. One issue you will need to be aware of is that some/many lenders are becoming increasingly reluctant about lending on new-build flats. Given that lenders are tightening conditions etc on FTBs anyway, this could be your biggest potential obstacle.

Having said that, I am also very new to this - I'm sure others will be able to offer a far more informed view.

neilp

One further thought - a lot of new build flats that I've seen advertised have huge service charges; enough for me personally to view them as a non-starter.

2bFrank

thank you for your reply. we have a viewing on friday evening so we will get a good view of the place. there is little pictures at the moment because it is just built. Not sure about how dear service charging is as i have just been looking for affordability. Its £12 per week service charge and £28 per wek rent on the other quarter that they own so this looks ok to us but unsure if this is expensive.

Thaks again and thoughs appeciated

PasturesNew

2bFrank wrote: »

Its £12 per week service charge and £28 per wek rent on the other quarter that they own

Doesn't look a lot does it .... but that's £172/month (to put it in real money)

2bFrank

Wow it looks a lot when you put it in them figures. Its still affordable for us at them prices luckly however still £172 wasted money.

trudiha

Before you make you mind up, have a look at this:

http://www.homebuy.co.uk/homebuy/product_first_time.asp

I think that it looks like a much better scheme than shared ownership on a new build.

Good luck.

2bFrank

Had a look at that and on the list for something similar, it wont work for us as were in the north but they said that they will be expanding it. and also put my name down for the new one www.ownhome.co.uk. got my fingers in as many pies as possible at the moment with fingers crossed. A lot of the schemes are about but most for key works and the likes. This is why the flat looks a good deal...but could be too good to be true.

guppy

Problem is, private new build flats everywhere seem overvalued and suffer from oversupply. A shared equity flat will be based on the price of a private one so you're exposed to any fall in value.

I agree about the service charges too. Good luck whatever you choose.

2bFrank

Yeah I totally agree with you. some of these flats are outragously overpriced (for example a whole studio flat no bigger than 15' by 15' in centre manchester was priced at £169,000) some fool paid it. We are treading carefully. Price of flat is lower than most in area however I feel that it is in no way a bargin and am sure that if house prices fell, then flats will be first to go down.

However its very affordable for us and if prices did fall, then half would be cushioned (also works otherway in that if prices go up, we only get half the benefit.)

Were not too worried about price, our main concern is problems with new builds. We would love a older property which is solidly bulit but our price range just wont meet it. we can wait for house prices crash (which may happen but nobody knows) and continue to rent, but my brother did this five years ago when house prices were set to crash...and he is still renting.

sarkin

New build properties are going to loose masive amounts of value over the next 12 months and I can can give you 1 very good reason why this is.

Eveyday we get emails from lenders telling us they are pulling out of the new build market or they want 25% deposit.

So as it gets harder and harder to get a mortgage for a new build, the developers will not be able to sell them, and will haave to slash the price.

The developer will do evreything he can not to drop the price i,e new white goods, carpets, solcitors cost paid, stamp duty paid. Reason is as soon as a valuer down values 1 flat the whole block will get hit.