Buying a new home off plan is becoming more popular and it can have financial advantages for the buyer as developers usually offer a discount on the market price, however, the services of an experienced residential conveyancing solicitor are essential to protect the buyer’s interests.
Buying off plan means that the home is not completed and buyers can choose a particular plot and often have the opportunity to personalise aspects such as flooring choice and bathroom appliances.
Although these are advantages, and the developer or builder’s price reductions may be as high as 20% if a property is reserved early, there are significant problems which may occur.
The final home may not be exactly how you envisaged, so, if possible, it is wise to visit similar developments by the same company before committing to a purchase and to check on quality of management and workmanship. If you move into the new house while others around are still being built, there will be a lot of noise, dirt and inconvenience from the continuing work.
The developer’s motivation in selling off-plan is usually to secure finance for continuation of the building work and once a potential purchaser has decided to buy, a reservation fee will be due and an agreement drawn up subject to exchange of contracts within an agreed time scale, usually 21 or 28 days.
Before a purchaser reaches this point, they should have arranged a mortgage or other finance and instructed a conveyancing lawyer because if the deadline is missed the developer has the right to withdraw some of the incentives originally offered or even refuse to continue with the sale.
The reservation fee, of probably £500 or £1,000, will form part of the deposit, which is usually 10% of the total price, and the balance of that will be due on exchange of contracts. The next stage is build completion, followed by legal completion when the remainder of the purchase price is paid.
When a new home is reserved the builder should give some indication of a completion date but there is no guarantee it will be finished when specified because of factors such as the weather. The purchaser will be given seven or 14 days’ notice at the end of the build for moving in.
Most new homes are given a 10-year warranty against defects, usually from the National House Building Council (NHBC), which proves they have been inspected before being signed off, and this covers subsequent major structural issues. If the house is sold within the period of the warranty, the certificate should be passed to the new owner.
Minor defects or ‘snags’ can be a more contentious problem because there is no monitoring system or specific standard for quality of finish. Where possible, it is advisable for a timetable for correcting snags to be written into the contract in order to press the builder to remedy them as soon as possible.
Buying a home off plan with Healys solicitors of London and Brighton
With a rising UK population, new homes are continually being built both on large estates and small infill developments and most will have opportunities for buying off-plan, requiring the services of an experiencedresidential conveyancing solicitorto ensure an efficient transaction.
If you use Healys, whether you are in London, Brighton or elsewhere in the country, all the pros and cons of buying off-plan will be explained in plain English and you can be assured not only of expert attention to the legal details of drawing up contracts but you will be kept informed of all progress.
Should any difficulties arise after the sale, Healys has the expertise and, thanks to its links with other professionals, as well as the skills across its general legal practice, the ability to advise and give practical assistance.
For more information and advice on costs of Healys’ conveyancing services, you can request a call-back via the website, email partner Kiri Kkoshi, telephone 020 7822 4148 or, in Brighton, associate solicitor Darina Gowentelephone 01273 669 115.