As the government continues to support the building of new homes, there’s a decent chance that the property you’re interested in buying is going to be a new build. Conveyancing for new build properties has quite a few differences, so it’s really important that you choose a new build conveyancing solicitor who’s experienced in working on new build purchases.
How does conveyancing for new builds work?
As a buyer of a new build you often have to commit to your purchase before the building work is completed, which is why the new build conveyancing process is often different to buying an older home. You may be buying a house which is in the middle of being built, or before has even construction started. This means you’re effectively buying a house off what you’ve seen in the show home or a computer-generated set of drawings.
New build conveyancing process step by step
Step 1: You reserve the new build property
You’ll usually expected to put down a non-returnable reservation fee between £500 and £2,000.
Step 2: Instruct a conveyancing solicitor
Choose a new build conveyancer who is experienced in working on new build purchases.
Click here to get a personalised conveyancing quote for your new build purchase.
Step 3: New build conveyancing checks are carried out
This is usually a quick and intensive process with only 28 days between reserving the property to exchanging contracts.
Step 4: Pay the deposit
The deposit will be 10% of the total new build’s property price.
Step 5: Exchange of contracts
This is done once all checks have been carried out, usually within four weeks from reserving the property.
Step 6: Completion
This is the date when your conveyancer will transfer the funds provided to the seller’s solicitor.
Before new build conveyancing begins
After deciding to go ahead and buy, you’ll likely have to put down a reservation fee of between £500 and £2000. This usually isn’t returnable but will come off your purchase price when you reach completion.
As soon as you have an offer accepted on a new build home, you need to immediately instruct a conveyancer and get your mortgage in place, as there is often a tight deadline to exchange contracts. Although deadlines can sometimes be extended, you may find that there’s a financial incentive for meeting agreed timescales. You’ll also ensure that you won’t lose either your reservation fee, and the house, by meeting these initial deadlines.
During the buying process
You must make sure you have a valid mortgage offer in place for when the property is eventually built. Mortgage offers are often valid for only a certain amount of time, and new builds can often surpass this timing, especially if work hasn’t even begun at the time of reserving the property. It is up to you and/or your financial advisor to keep in touch with your mortgage lender to either arrange for an extension to the product you have chosen, or switch to an alternative.
Your conveyancer will have to thoroughly check the title documentation, planning permissions, building control and any warranty of your new house for you. This is often a lot more complicated compared to buying a standard property. As your legal representative may need clarification in order to thoroughly check the contracts, you must be in a position to answer any queries as quickly as possible.
You will need to pay a 10% deposit to your conveyancing solicitor who will transfer this to the seller’s solicitor, unless you are buying with the Government’s Help to Buy scheme, where the deposit is 5%. Look out for developers registered with a warranty provider as this will protect your 10% deposit from penalties from withdrawing from the sale if there are unreasonable delays.
The last steps: Exchange and Completion
Once you’ve reserved your property, you’ll typically have four weeks to exchange contracts. If you don’t manage to do this, then the builder can pull out of your deal, meaning you lose both your reservation fee and the house. If the development you’re buying into is very popular, builders can be particularly ruthless when it comes to hitting timescales.
Once everything’s been ironed out, including details such as local searches, you can work towards exchanging contracts. To provide additional peace of mind, you should receive a ten-year guarantee from the builder which is usually provided by the National House Building Council (NHBC), Buildzone, Premier Guarantee or another specialist warranty provider. You should ensure that you know exactly what is and isn’t covered and for how long before you agree to exchange contracts.
For more information about buying your first house read the First-time buyers guide.
New Build Conveyancing FAQs
Is new build conveyancing more difficult?
Yes, difficulties may be faced with non-compliance of planning regulations, NHBC inspections not being arranged, discrepancies in the site and location plans, local authority agreements and the completion of the roads and sewers over the whole development.
What is different about new build conveyancing?
Unlike purchasing an older property, a new build property may not have been built, or in the process of being built, when the you purchase it.
It is usual to have only four weeks to exchange contracts after reserving the property.
Compared to buying an older home, a fixed completion date is often not given. Instead, written notice is given to the buyer when the property is structurally complete, for completion to be carried out within a set time, usually 10 working days.
What happens when you reserve a new build?
You will typically have four weeks to exchange contracts. If you don’t manage to do this, then the builder can pull out of your deal, meaning you lose both your reservation fee and the house.
As soon as you have an offer accepted on a new build home, you need to immediately instruct a conveyancer and get your mortgage in place.
What should you be on the lookout for?
Delays outside of anyone’s control such as extreme weather conditions and shortage of materials
Making sure that your mortgage offer will not expire before completion
Knowing exactly what is and isn’t covered in the National House Building Council (NHBC) ten-year guarantee (or equivalent)
Developers registered with a warranty provider which will protect your 10% deposit from penalties from withdrawing from the sale if there are unreasonable delays.
Need help with conveyancing?
We work with conveyancers across England and Wales that have a wealth of experience with new build purchases. Browse new build conveyancing in Milton Keynes, Leeds, Manchester or view all the locations.
To receive a personalised quote for new build conveyancing, complete our short quote form.