Guide to Buying a New Home Through Lauristons Estate and Lettings Agents in South West and South East London

A Guide To Buying A New Home

Guide to buying a new build home

Our guide, ‘The Buying Process,’ focuses on the general process involved in finding, funding and securing your new property. Below we have more detailed information about buying a new build property and some of the differences when compared to purchasing a home that is ‘pre-owned.’ For further help and advice, please contact our New Homes sales team.

The government is heavily incentivising buying new-build homes. You can buy a new home with a deposit of just 5% using the Help to Buy equity loan scheme. For more information visit our page that explains the different schemes in more detail; ‘Help To Buy.’

New-build mortgages

Getting a mortgage for a new-build home can sometimes be harder than for an older property, as some lenders put stricter limits on the maximum value of a property on which they'll offer a loan and some lenders will not loan at all on new-build properties.

This means you might be restricted to borrowing 85% of the value of a house, or 75% on a flat, while lenders may be willing to loan a bigger percentage on an older property.

Timing can also be an issue. Mortgage offers tend to be valid for up to six months, which can cause a problem if you're buying a home that hasn't been built yet, known as buying ‘off plan,’ and the completion date is further in the future. Some lenders will consider extending their offers, but this is often subject to reassessing your application and may not be a straight-forward process.

The mortgage brokers at Lauristons are experts on securing the right mortgage for a new build home. Please go to ‘Financial Services’ for more information on contacting our brokers

Pros

Advantages of buying new-build homes

Guarantees: new-build homes come with a 10-year warranty covering structural defects. Most developers also provide their own two-year warranty for interior defects.

Specification: new homes are built to the latest specifications, so major repairs should be unnecessary for the first few years. They tend to be more energy-efficient, too, so you could benefit from lower utility bills.

Personalisation: if you buy off-plan, you might be able to choose your fixtures and finishes. This is great if you're attracted by the 'blank canvas' element of buying new-build.

Incentives: the government's Help to Buy equity loan scheme and Starter Homes Initiative are only available on new homes.

Ease of purchase: there's no upward chain to contend with when you buy a new-build home.

Cons

Disadvantages of buying new-build homes

Delays: if there's a hold-up during construction, your mortgage offer could expire.

Defects: not all problems will show up in a snagging survey.

Risk: plans and brochures don't always give a clear idea of what the home will actually look like when it's built.

Size: the rooms in new-build homes are often smaller than those in older properties, so you'll need to make sure your belongings will fit.

Disruption: if you're one of the first to move in, you could find yourself living on a building site while the rest of the work is completed.

Step by Step Guide

Find a suitable development. Research the area, the local amenities and the developer's track record.
Seek guidance from a mortgage adviser about how much you might be able to borrow.
Visit the show home or marketing suite and choose a property. Pay a reservation fee.
Employ a conveyancer to deal with the legal side of your house purchase.
Arrange a mortgage, and wait while your lender has the property independently valued.
Exchange contracts and pay your deposit.
Before you move in, arrange to have a snagging survey conducted.
Get ready for both the short stop date (when the developer expects to finish work) and long stop date (the date the home has to be completed by).

Conducting a snagging survey on a new-build home

Before moving into your new home, you should have a snagging survey completed to identify any problems.

A snagging survey will outline distinct types of defects, from bad water pressure to faulty fixtures.

You can conduct a snagging survey yourself, but given the amount of money at stake when buying a home, we'd recommend instructing a surveyor.

Having said that, some defects might not come to light until you move in. During the first few months, it's useful to keep a list of any issues that arise and stay in regular contact with the developer.

Schemes to help with buying new-build homes

There are several government-backed schemes that fall under the ‘Help To Buy’ initiative. For more information visit our dedicated page.

Using part exchange to buy new-build homes

Some house builders run part-exchange (PX) schemes, which allow buyers to purchase a new-build home and use their current property as part payment.

While part-exchange schemes remove the hassle of selling your home the traditional way, there are disadvantages.

Some developers will offer below the market value, so you should always have your own valuations from local estate agents before agreeing to anything.

To request a valuation for your property, please click ‘here’.