12 May 5 steps to bagging a bargain new build
New build homes might not be for everyone, but those who do buy them love them and often overpay for the privilege of being the first ever owner. Despite the recession and the problems in the housing market, house builders can still get away with charging a premium for brand new homes. It is the same principle in the new car market. The car loses a big chunk of its value the moment it is owned and driven away. Many new build home buyers will not get back what they paid for them if they buy and sell in the same depressed housing market, so it makes sense to minimise that potential loss from the outset by negotiating hard on purchase price.
This article looks at 5 ways you can reduce the cost of buying a new build home.
1. Don’t buy off-plan
There are big risks to buying off-plan. While you may get a bargain in a hot-bed development, the chances are that by moving in too fast, you’ll pay the price the developer hopes to get, instead of the lower price they will accept when desperate to shift the houses they have already built. Developers sink a lot of funds in to building homes and often need cash to finish developments, so if you get there part way through a hard-to-shift development, the builder might be motivated to sell for less. The same holds true at the end of a development if there are houses they just can’t sell.
2. Ask for a discount
Don’t be afraid to negotiate. As above, there are bargains to be had, but a developer is never going to offer you a chunk off the price if he thinks you are good for the full asking. Negotiate hard and leave their office potentially thousands of pounds better off. And if the price isn’t right, don’t be afraid to walk away and await their call. There is a rock bottom price, and you will usually only get this at the end of the developer’s financial year. If you can hold your cards close to your chest and wait it out, you could be in line for a big discount.
3. Fish for freebies
If you are keen on the house and you plan to proceed, you can still play hard ball on the extras. If you can provide an incentive, such as signing the agreement there and then, they may be motivated to offer some great incentives. Free extras like carpets, good tiles, better kitchen units and even grass for your lawn are all fair game.
4. Buy off-plan
I know we just said don’t buy off plan, but not buying off plan and buying off plan are both valid ways to get good discounts. It all depends on the market and the popularity of the development you want to buy on. The big off-plan Buy to Let scandals of the last decade are enough to put anyone off gambling on an imaginary big discount, but in the right circumstances, and on hot developments, you can get discounts of up to 20% off.
5. Be a snag hag
Developers usually just fix those snags you find before you move in, but the fact is that most problems only come to light once you have lived there a little while. These defects can run into thousands of pounds so it could be worth having an independent snagging surveyor come in. The report they produce will cost around £200, but they are experts at picking up on defects and know all the tricks. You can use the report to negotiate an agreement to fix prior to exchange of contracts.