Buying a new build property can be a little more complicated and involve more steps in the process than other properties.

Jo Francis, who is a highly experienced conveyancer in the Residential Property team at Phillips, is a specialist with new build purchases and fully understands the service that is required to ensure the tight deadlines set by developers are met.

“While buying a newly built house has many benefits, such as having no chain, and having no need to carry out DIY work for a while, from the legal side of things the conveyancing can be more complex and time consuming,” explained Jo. “This is because the potential for something to go wrong is much higher with a new build purchase. These issues can include non-compliance with planning regulations, incomplete agreements for roads and sewers and the failure to plan for the future maintenance of common areas of a development, which can cost you dearly, if these issues are not addressed properly.”

In addition to avoiding these problems, Jo will be working for you, making sure that the contract is in your favour, ensuring your deposit is fully protected and that there is a ‘long-stop’ completion date for the property to be finished by.

Before the new build conveyancing process begins

Before the new build conveyancing process starts, you must ensure your finances are in order as very often you will find developers insist that the finance for the mortgage is secured before the contracts are exchanged.

“Generally, most standard mortgages are only valid for six months,” explained Jo. “If the property isn’t completed within this period, you will have to apply for an extension from your lender, subject to them reassessing your circumstances, or you may have to reapply for the mortgage at a later date. However, there are some lenders who offer specific new build mortgage deals which can last for nine months.”

Check the specifications

While it may sound like common sense, Jo advises buyers to carefully check the specification details of the property before making a reservation. “Don’t forget to pay attention to the landscape drawings and electrical plans,” said Jo. “It’s also worth visiting other similar sites built by the developer to see if the properties meet your requirements.”

“Often developers offer various incentives such as choosing fixtures and fittings, and appliances. In some cases, the Stamp Duty Land Tax costs may also be included too.”

Reserving your property

Be aware that you will need to pay reservation fees when making an offer or when a sale is agreed. This is usually set for a 28-day period and covers the period leading to the exchange of contracts.

“Fees tend to range from £500 to £2,000 or more in the case of more expensive properties,” said Jo. However, this is deducted from the purchase price when you complete.”

“But be warned, this fee is non-refundable if you fail to exchange contracts in time or if you decide to pull-out of the purchase. That’s why it’s important that your mortgage is agreed in principle before you make a reservation.”

Paying the deposit

Buyers usually have to pay a deposit of either 5% or 10% of the full purchase depending on whether the Help to Buy Equity Loan scheme is being used. At the same time, you will also be asked to sign a contract which is normally prepared by the housebuilder.

“A major problem that can arise is that mortgage lender valuations are usually taken at the beginning of a new build project and sometimes after construction is completed. If there is a long period of time between exchange and completion, there is a risk the property value could decrease which could affect the mortgage offer and the amount your Lender will agree to lend you.”

The handover

At completion, there will be an official handover of the property to you, including the keys, building logbooks and owner manuals.

“At this point make sure you are given copies of all the guarantees for the property including those for white goods like fridges, boilers and cookers and for things like window frames and flat roofs,” said Jo.

“Prior to the handover, check for any defects, known as ‘snagging’ which the developer can rectify, ideally before you move in.”

If you would like to discuss purchasing a new build property, please contact Jo by emailing [email protected] or by calling 01256 854634.

Alternatively, click here to request a conveyancing quote online.