Buying a house on a new development
By Jo Eccles
Q: We are currently trying to buy a house on a new development; the one we really wanted has already been reserved, a different plot of the same house type is available but it’s slightly smaller (due to box windows instead of bay windows), yet it’s the same price. Should we offer lower than the asking price on the second choice property (bearing in mind the development seems in high demand)?
A: It’s always frustrating when your first choice property goes. Don’t despair, there are always options.
Firstly, when a property is reserved, the buyer usually has a time scale in which to exchange contracts. If they don’t do so within the time scale, the developer may be open to switching buyers so there is a chance it may become available. However, this isn’t guaranteed, so if you don’t want to risk losing your second choice then it may not be worth waiting around to see if the purchase goes ahead or not.
If you go down the second route make sure you’ve chosen the property from all of the options. With new developments, remember that developers don’t launch the entire development straight away, they tend to drip feed the properties on to the sales market in phases. So when you’re choosing which plot you want to buy, do look at all options on the development plans. If you see a plot you like which isn’t released, put the question to the developer. We have secured many properties for clients this way, persuading a developer to sell us one of the unreleased plots.
Once you’ve selected your second choice property, definitely take your lead in terms of offer level from the first choice property which is under offer. To get an accurate sense of pricing, you do need to know what your first choice property sold for, so that you can offer less. The developer may not disclose this, and if they don’t, it may be guess work.
If the first choice property is almost identical in terms of just as good a position and the garden faces the same way, then you should definitely be offering less as a starting point if it’s smaller. The developer may well have good reasons for pricing it the same as the larger property, in which case the negotiations will go back and forth until you reach a price you’re both happy with. Developers aren’t as emotional as individual buyers, so hopefully you can agree on a price fairly quickly and avoid losing this one too. Good luck!
If you have a question you’d like Jo to answer please email Jo.eccles@SPpropertygroup.com or tweet her @joeccles.