The homebuyer’s roadmap: A guide to purchasing new-build homes
Thinking of buying a new-build home? Follow our homebuyer’s roadmap to make the process as smooth as possible.
Buying a new-build home comes with many benefits, creating an appealing proposition for many homebuyers. Firstly, new-build homes come with a blank canvas, allowing you to personalise your home from the start. There’s no need for renovations or updates, and modern building standards often mean better energy efficiency, which can lead to savings on utility bills.
New-build homes also come with fewer upfront repairs. Everything, from appliances to HVAC systems, is brand new and under warranty. This can provide peace of mind and financial stability, especially in the early years of homeownership. This guide offers valuable insights to make your home-buying process smoother.
Financing a new-build home
Navigating the financing process for a new-build home can be intricate, but understanding the basics of new-build mortgages can simplify it. A new-build mortgage is essentially the same as any other mortgage, but some lenders offer products specifically designed for new-build properties.
Like standard mortgages, new-build mortgages usually require a deposit. Lenders typically lend up to a certain percentage of the property’s value, known as Loan to Value (LTV). However, new-build properties may have a lower maximum LTV, meaning you might need a larger deposit than an older property.
Approval for a new-build mortgage might also depend on the property being ready within a certain timeframe, as lenders often require the home to be habitable within six months from the mortgage offer date. Therefore, ensuring your property’s completion timeline aligns with your mortgage agreement is crucial.
Developers may offer incentives to make purchasing a new-build home more attractive. These incentives can range from contributions towards your deposit, offering to pay a portion or all of your stamp duty, including upgrades to fittings and finishes at no extra charge, or even offering a part-exchange scheme where the developer buys your current home.
While these incentives can be appealing, it’s essential to consider their impact on negotiations. Sometimes, it might be better to negotiate on the price rather than take the incentives. Remember to discuss all these options with your mortgage advisor to make an informed decision.
Choosing the right developer
A reputable developer can ensure your home is built to high standards and delivered on time. There are various factors to consider when making this choice.
Firstly, consider the developer’s experience and reputation in the industry. An established developer with a solid track record is generally more reliable. You can research their past projects, check customer reviews and ratings, and even visit their completed properties to assess the quality of construction and design.
The developer’s financial stability is another crucial aspect. A financially secure developer is less likely to run into delays or go bankrupt in the middle of the project. You can use public records and reports to assess their financial health.
It’s also essential to understand the developer’s after-sales service. How do they handle issues that come up after you move in? A developer that offers exemplary after-sales service will address these problems promptly and efficiently.
Check the warranty and insurance that the developer offers. A new-build home usually comes with a 10-year warranty. This provides protection if there are structural defects in the property.
Lastly, consider the developer’s commitment to sustainable construction. Developers that adhere to green building practices contribute to environmental conservation and build homes that are more energy-efficient and can save you money in the long run.
New-build warranties and guarantees
Building warranties and NHBC (National House Building Council) guarantees are essential safety nets for new homeowners. They provide assurance that the home is constructed to a certain standard and offer protection if something goes wrong.
A building warranty, also known as a structural warranty, is typically a 10-year insurance policy provided by the developer, which covers defects in the structural integrity of the new build. This can include issues with the foundations, walls, roof, and other structural components. It’s important to note that the warranty typically covers major structural defects, not minor issues or wear and tear.
In the first two years (often called the ‘defects insurance period’), the developer is usually responsible for fixing defects that are not considered general wear and tear. From the third year onwards, the insurance will generally only cover major structural defects. You can learn more about the building warranty that suits your needs at https://buildsafe.co.uk/.
The NHBC guarantee is one of the most common building warranties in the UK. NHBC’s Buildmark warranty covers potential physical damage due to the builder’s failure to build to NHBC Standards. It provides protection if the builder goes insolvent and cannot complete the home.
These warranties and guarantees are crucial for buyers as they offer financial protection against unexpected repair costs and assure that their new home meets defined construction standards. Always understand the terms and coverage of your builder’s warranty or NHBC guarantee when buying a new-build home.
Conducting thorough checks and surveys
A snagging survey is a crucial step when buying a new-build home. Despite all the benefits of a new property, construction issues can sometimes occur, and a snagging survey helps identify them. It is a thorough inspection that checks for defects or incomplete work, ranging from minor cosmetic issues like a scratch on a window pane to major structural problems.
The snagging survey should ideally be conducted between the building completion and your move-in date. This gives the builder time to rectify the identified ‘snags’ before you move in. However, most warranties allow snagging surveys to be conducted within a certain time frame after moving in.
Common snags include plumbing and electrical faults, heating issues, inadequate insulation, improper fitting of doors and windows, and poor finishing of kitchens or bathrooms. Although these issues may not necessarily compromise the building’s structure, they can affect your living experience.
Resolving snags before moving in can ensure a smoother transition into your new home. List all the snags identified during the survey and present them to your developer. Reputable developers will fix these issues at no extra cost as part of their commitment to delivering a quality home.
Even after moving in, keep a close eye on the property. If you identify any new issues, report them immediately to the developer during the warranty period. Understanding your rights and the builder’s responsibilities can help ensure that your home is completed to your satisfaction.