The pros of buying a new-build house - and common mistakes to avoid
We break down the advantages of purchasing a brand new house, and share some of the pitfalls to avoid when choosing a new-build property
From large-scale developments to boutique schemes and one-off houses, new-builds have many advantages over existing homes.
- They’re in pristine condition, no one’s lived there before and once you move in you can simply unpack and get on with your life without the upheaval of renovations and repairs.
- If you do notice any problems with the build, new-build homes come with a 10-year warranty covering defects (for the first two years) and structural defects (for the 10-year period).
- New homes tend to be highly energy-efficient, so bills are much lower
- New-builds are often better designed for modern family lifestyles with open-plan layouts, en-suite bathrooms, utility areas and smart technology
- The purchasing process is usually much simpler as there’s no onward chain and so lower risk of delays or collapse
- On some developments, residents may also have access to shared amenities such as a concierge, gym or playground area.
- You may be lucky enough to qualify for a financial boost or incentive.
However, before you buy, make sure you know what to look for and the mistakes to avoid, as well as making sure you're prepared to take advantage of any financial incentives available. Here are our top tips:
What to know before you buy a new-build home
Be show-home savvy
Show homes are designed to be as enticing as possible, but make sure you look beneath the surface so you’re not disappointed.
Find out exactly what’s included in the price, whether you’re able to choose your own kitchen and bathroom fittings, flooring and tiles, how much the service charge is and what the parking arrangements are.
Ask whether the garden will be fully landscaped, which way the property will face, what the view will be and when work on the site is due to complete.
Check ceiling heights and room sizes, and whether there’s sufficient storage, and watch out for tricks such as using small furniture and mirrored surfaces to make rooms look bigger and lighter than they really are.
Boost your budget with Help to Buy loan
Since its introduction in April 2013, the government’s Help to Buy equity loan scheme has assisted more than 220,000 households in buying a new-build by providing a loan of up to 20% of the cost (40% in London).
Purchasers need just a 5% deposit and a 75% mortgage for the remaining share of the property, giving them access to better deals than when borrowing a higher proportion of the value. The loan is interest-free for five years and repaid when the home is sold.
Help to Buy loans are restricted to first-time buyers purchasing in England, with regional property price caps:
- East £407,400
- East Midlands £261,900
- London £600,000
- North East £186,100
- North West £224,400
- South East £437,000
- South West £349,000
- West Midlands £255,600
- Yorkshire and The Humber £228,100
The scheme will run in its current form until March 2023.
Explore shared ownership
Shared ownership is targeted at aspiring homeowners whose budgets don’t stretch to purchasing 100% of a home, allowing them to buy a stake they can afford and pay subsidised rent to a housing association on the balance. These schemes are mostly available for new-build developments - although older homes do come up for sale - and open to households with a total income of up to £80,000 (£90,000 in London).
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You do not have to be a first-time buyers to take part in the scheme, but you cannot already own another home, unless you are in the process of selling it. You must be able to demonstrate that your income would not allow you to purchase a suitable home at market prices.
Housing associations may have their own additional criteria for eligibility - make sure you read them carefully.
Deposits are much lower than when buying on the open market as they’re only needed for the share being bought, which can be as little as 25% of the full value. Once you have purchased your share, you have the opportunity to increase it in the future through a process known as staircasing.
Take advantage of financial incentives
Some house builders offer inducements in a bid to get their homes sold. These can include stamp duty and legal fees paid, furnishing packages, appliance upgrades or free season tickets. Although they may sound tempting, make sure you do the maths before committing to buy. Compare costs of similar homes at other local developments and if you’d rather have money off the purchase price instead, ask if there’s wiggle room on price.
Part-exchange may be a far more practical incentive when upsizing, as the developer will buy your current home from you at an agreed price based on independent valuations. This means you won’t have the hassle of hiring an estate agent, finding a buyer or getting stuck in a chain.
Consider a conversion with character
A common criticism of new-builds is that they’re lacking in character, so why not think outside the box and consider a freshly converted home with a history?
Up and down the country, schools, factories, hospitals, hotels and a myriad of other redundant buildings are being given a new lease of life as comfortable, stylish homes combining original details with contemporary features such as double or triple glazing, and high-spec kitchens and bathrooms.
Examples include The Denham Film Studios in Buckinghamshire, from Weston Homes, which includes a restored Art Deco cinema, and Haseley Manor, a magnificent Warwick manor house renovated and converted by Spitfire Bespoke Homes.
Know what's covered by after-sales services
Most new homes come with a 10-year warranty, usually provided by the National House-Building Council (NHBC). For the first two years it covers most defects but after that it can only be used for major issues, such as structural problems.
As soon as you move in, or beforehand if you have access, make a note of anything that needs fixing and report it to the housebuilder, who is legally obliged to remedy all faults. Check for cracks, chips in paintwork, uneven finishes and leaking taps and consider paying for a professional snagging survey to pick up things that you might miss.
Keep copies of all correspondence and if the issues aren’t resolved, contact the NHBC or other warranty provider
Feature by Andrea Dean.
This is a digital version of a feature that originally appeared in Your Home magazine. For more inspirational home ideas, why not subscribe today