10 February 2017 by Amie Mackay

New build home buyers – checklist

It has been reported that 2016 saw the highest number of first time buyers since the financial crisis in 2008.

Over recent months we have seen a continued drive by the Government to create more affordable homes, by for example its promotion of shared equity schemes such as Help to Buy. This, together with lower interest rates, higher levels of employment and longer term mortgages, suggests more people are accessing the property market at a time when house prices are continuing to rise.

House building in England is also at its highest level in eight years with the number of new homes being built having increased 11% in a year. Housing Associations and builders are therefore under pressure to maximise the housing supply and build new homes fast.

Buying a new home, particularly “off plan”, requires a bit more thought when compared with a second hand purchase. Together with fears by some that this rush to build might see a reduction in build quality means new home buyers need to proceed with more caution. To help, here is a new build homebuyers checklist to help ensure buying your new home is a positive and exciting experience.

New home buying Checklist

Buying off plan

Check the plan against the accompanying legal documentation to ensure it correlates to what you have agreed with the builder.

New Home Guarantee

NHBC is the most common new home guarantee available but it’s validity must still be checked before any purchase contract is entered into. It provides buyers with protection as it ensures standards for design, materials and workmanship are followed during construction. There are however some exclusions, the guarantee will not for example cover general wear and tear, condensation and cosmetic damage. If you have any concerns as to the build quality or whether the NHBC guarantee will provide cover, you should seek further professional advice.

The deposit

Be wary of when you pay your deposit because completion is potentially some time in the future and you need to ensure your deposit is protected in the event the builder becomes insolvent or defaults on the terms of the contract.

Your mortgage

Your mortgage offer will usually have an expiry date 6 months from the date it has been issued. You will need to ensure that your mortgage offer is still valid by the time you complete. Completion is quite often delayed with new properties so it is good advice to stay in contact with your lender and notify them if you are getting close to the 6 month expiry date. This will mean you are more likely to secure a new mortgage offer quickly and reduce the risk of delaying the purchase.

Extra checklist if you are buying a flat

The lease and restrictions on use

You should expect to be offered a lease of in excess of 90 years, the longer the better! If the lease is for less this could make securing a mortgage more difficult and may in some circumstances mean the resale value is lower.

Check the terms of the lease carefully (or get a solicitor to do that for you) as you need to ensure there is nothing in the document that might restrict your use of the property such as being able to sublet the property at a later date.

Service charges

You will have to pay a service charge. Generally this is to pay for facilities that you will share with other flats in your block i.e. the maintenance of common parts. You should be aware that this charge will increase over time and is something you should budget for at the outset. It is also a good idea to get a solicitor to check the provisions for service charges in the lease, not least to ensure there are no nasty surprises.

If you have any questions about buying a new build property please do not hesitate to contact contact Amie Mackay on 020 7288 4758 or at AmieMackay@boltburdon.co.uk.

You can also contact one of our other solicitors in the Residential Property team here.

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