Many people dream about owning a property. Once we have the budget, we can choose between new builds and secondary real estate. They are different, and this article is dedicated to new-build homes only.
To help prospective homeowners and smoothen the property buying process, real estate experts gathered helpful info on new-build homes and the associated processes.
A new-build home
New-build homes are flats and houses that had no previous owners. In other words, no one has lived in such properties.
Some properties seem new and modern but have been already owned by someone – they are not new builds.
A property ownership type
Property specialists at 1newhomes gather info on new builds, the buying process and explain basic questions.
Any real estate deal goes under two tenures or property ownership types: freehold and leasehold.
Briefly, the first term means unlimited ownership of both property and the land underneath. Leasehold refers to ownership of homes but not the land for a limited period stated in the lease agreement.
Typically, new-build houses are freehold properties, while new-build flats go under leasehold.
Advantages of new-build homes
1. New builds offer flexibility and freedom of customisation–you can personalise almost everything in your new home to your style.
2. New builds are modern, energy-efficient and durable. Developers implement contemporary technology to deliver carefully designed, long-lasting buildings (from 75 to 150 years) that usually offer lower utility costs.
3. The process of buying new builds is transparent. Buyers will avoid gazumping or property chains when purchasing new builds. In short, these terms refer to problems and delays with offers and deals present in the secondary real estate market.
Purchasing a new-build home
1. Find a match
Once you have worked out the budget, you can explore and discover new builds in your desired area and find a perfect fit.
2. Make an offer
Make an offer to secure your desired new build. If it is accepted, you need to pay a reservation fee to secure the property until the development is done. The paid fee is taken off the final price. But, generally, it is non-refundable if you call off the deal later.
3. Work out the details
If you find a perfect match and get your offer accepted, work out the legalities by using a specialised solicitor. Also, check if the property has the needed access: services, transport infrastructure and sewers. Then you can apply for a new build mortgage. It is vital to avoid the rush and hasty decisions.
4. Move in
You will get short-stop and long-stop dates once you agree on your move. The first date means the anticipated development completion, while the latter one refers to the ultimate deadline. In other words, the long-stop date is when the developer has to complete the work.
Frequently asked questions about new builds
1. When to exchange contracts?
While contract exchange is the legally binding part of property deals, times are often uncertain. This is because of the waiting period until the completion of the development.
Moreover, contract exchange should happen when you have the mortgage agreement and are ready for the deposit (10% to 25% of the final price).
Usually, when you work out the formalities, you can have contracts exchanged around 28 days before the completion date.
2. When to pay the council tax?
Moving in a new build often takes time because homes are usually unfurnished, and new homeowners need to work out the renovation and utilities. You can get a 100% discount for the first month of the council tax after the development completion. Then the standard local council tax rates are applied.
3. Is the Help-to-Buy exclusive for new-build homes?
The government-backed Help-to-Buy scheme for first-time property buyers applies to new builds only. Ambitious buyers also need to find a property that fits the affordability range to take advantage of the scheme.
One of the experts at GoodMove says that new builds are attractive, but there are things to consider such as their advantages and the buying process. Prospective buyers and first-time buyers may not know these nuances.
What is next?
Curious about a new build project? Take the first step and start exploring the new-build homes market. Property ownership is often a pivotal moment in life. It turns out successful when it is well-thought-out and prepared for.
Start easy and effortlessly – real estate specialists gathered helpful data on new developments in London to support ambitious buyers. Looking ahead to next year, there are new homes in London with completion in 2022.