The pros and cons of buying a new-build
28th August 2019
Victorian charm can be seductive, but older properties don’t float everyone’s boat. There’s the drafts and endless maintenance, to say nothing of unfortunate renovations.
Avocado bathroom anyone?
It’s little wonder that a shiny new-build can seem just the ticket.
But before taking the plunge, it’s worth remembering there are also downsides to buying a new-build. Here are some of the pros and cons to help you make up your mind.
The pros of buying a new-build
It’s YOUR home.
A new-build is a blank canvas. There’s no hideous wallpaper to strip, dodgy DIY jobs to repair, or démodé kitchens to toss into a skip.
New-builds can also have lower fuel costs as they’re often more energy-efficient than older properties.
They’re also generally more secure. Locks on windows and doors conform to the latest British Standard, and many new-builds come with fitted security alarms.
The other good news is that the Government announced in June 2019 that leasehold agreements are to be banned on new-build houses. This will mean the end of developers taking financial advantage of leaseholders by setting crippling ground rents.
The cons of buying a new build
One of the biggest disadvantages of buying a new-build is that you might need a bigger deposit.
That’s because new-builds come with a price premium.
Some lenders limit the amount they’re prepared to loan on new-builds, often asking for a deposit of 15% or more.
There are also hidden costs. Expect to pay for extras such as flooring and lights which you’d expect to be included in the price.
Completion dates for new-builds can also throw a spanner in the works. Most builders have an exchange deadline from 28 to 42 days after you pay your £500 reservation fee, which can be months before the property is anywhere near completed.
Most mortgage offers are valid for six months, but be prepared to speak to your lender about an extension.
You should also bear in mind that the government Help to Buy scheme for new-builds is coming to an end in 2023, pending a governmental review. From April 2021, it’ll only be available to first-time buyers where the home’s value exceeds a certain price cap (depending on location).
Take your pick
There are numerous advantages and disadvantages to buying a new-build - and these are only some of them.
Hopefully, you’ve got some idea of whether a new-build is right for you.
“Only you can decide whether the extra cost of a new-build is worth its benefits,” said Rhys Payne, a Trussle Mortgage Adviser.
“It’s a good idea to compare older and new properties in the area you’re looking at and weigh up the advantages and disadvantages.”