How do I buy off-plan?
There’s no rigid process to follow when buying off-plan. However, to help things run as smoothly as possible, make sure you check off the below:
Step 1: Explore suitable developments
Research and arrange visits to developments in your desired area. If you plan on using a help to buy scheme, check that these are eligible.
Step 2: Speak to a mortgage advisor
Speak to a mortgage advisor and discuss your options. You may wish to go one step further and get a mortgage agreement in principle. This confirms an amount that a mortgage provider is intending to lend to you, and will strengthen your standing with developers.
Step 3: Make an offer
Once you’re set on a property, make your offer. If it’s accepted, you’ll usually be asked to place a reservation fee to hold the property while you get your mortgage in place – this could be as much as £1,000 and is usually non-refundable.
Step 4: Appoint a conveyancing solicitor
A conveyancer or solicitor will carry out the legal work involved in your property purchase, checking everything’s in order with the development and your specific plot. The developer will usually impose a deadline when it comes to exchanging contracts off-plan, meaning you’ll have to exchange within 28 days of agreeing the purchase.
It helps to be as prepared as possible and read up on new-build conveyancing and the conveyancing process in general
Step 5: Sort your mortgage
Once the legal work is in process, agree your mortgage with a provider. The lender will then arrange for a valuation, based on your property’s plans and specification.
How do mortgages work for off-plan properties? When you get a mortgage offer, it’ll likely be valid for six months. If you haven’t completed in that time, you could experience mortgage challenges (more on this below). Keep in regular contact with your mortgage provider and, if it looks like your offer may expire due to late delivery of the property, discuss an offer extension. While they’re not obliged to, many lenders will agree to this for a limited amount of time.
Step 6: Do the paperwork
You’ll need to complete any paperwork, with the help of your conveyancer, by the deadline set by the developer. They’ll then facilitate the exchange of contracts and deposit.
Step 7: Plan your move in
There will be two dates to bear in mind. The first – the ‘build completion date’ – is when the developer expects the work to be completed and for you to be able to move in (this will only ever be a best guess). The second is the ‘long-stop date’, and is the latest date the developer expects to have the property completed by.