Buying a house is a significant milestone for many people, but it’s quite a daunting process - especially for first-time buyers. If you're considering purchasing a new-build property in the UK, it's essential to understand the steps involved and the factors to consider. This beginner's guide to buying a house on a new-build development will help you navigate the house-buying process with confidence.
Beginner's Guide to Buying a House on a New-Build Development
Follow these steps to start your home-buying journey:
Assess Your Financial Situation
Before you start searching for a new-build house, it's essential to assess your financial situation. Determine your budget by evaluating your savings, income, and any existing debts. Additionally, consider consulting with a mortgage advisor to understand the amount you can borrow and the associated interest rates. This step will give you a clear idea of the price range you can afford for your new-build house.
Research the Housing Market
The next step is to research the existing or planned developments in your chosen area. Consider the different areas on offer to find the right location for your needs. Take into account factors such as proximity to amenities, transportation links, schools, and crime rates. Use online property portals and local estate agents to gather information on new build property prices and market trends. You’ll also want to get used to the jargon and technical phrasing used during the house-buying process, as this can get confusing without an understanding of these terms.
Secure a Mortgage in Principle
Securing a mortgage in principle is an essential part of the house-buying process. Shop around for mortgage deals and compare interest rates, terms, and conditions. Consider consulting with multiple lenders to find the most suitable option for your circumstances. As a first-time buyer in the new-build market, you might also want to look into whether shared ownership is right for you as this can be an affordable option. Obtaining a mortgage agreement in principle before making an offer on a property is a useful way to demonstrate your intention to buy, improving your chances of securing the property you want.
Find a Property
With your budget and mortgage pre-approval in place, you can start actively searching for your perfect new-build property. Attend viewings at development sites and utilise online property portals to explore available options. Make a list of must-haves and nice-to-haves to guide your search and always ask the right questions to ensure you know what’s included. Remember to consider factors such as property size and potential for growth in value too. Above all, take your time and don't rush into making a decision!
Choose Your Plot and Reserve
Once you've found the right property, it's time to lock it in. This is your opportunity to secure your preferred plot and reserve it so that others can’t snap it up. Before you make your final decision, make sure that the plot has everything you want there. You can choose specific options for your home (provided it’s feasible given the current build stage) so that it ticks all of the boxes for you. Speaking with the developer about this ahead of time is a great way to customise the property and make it ready for your move-in date.
Exchange Contracts and Completion
Once all of the negotiations and legal creases have been ironed out, you'll proceed to the exchange of contracts. At this stage, you and the seller become legally bound to complete the transaction. You'll be required to pay a deposit, usually around 10% to 30% of the total property value when buying outright, or 5% to 10% of the share of the property you’re buying on a shared ownership scheme. You’ll then be given a rough completion date, which will be confirmed when notice is served, which is typically around 2 weeks prior to completion. On the agreed-upon completion day, the remaining balance is transferred and you officially become the owner (or shared owner) of the property.
Post-Completion
After completion, celebrate your new home! However, remember that there are still essential tasks to complete such as notifying utility companies, setting up new accounts, and arranging home insurance. Update your address with relevant authorities, and consider organising a thorough cleaning or any necessary renovations before moving in.
Buying a New Build Home is Easy With Preparation
Buying a new-build house in the UK is an exciting process that offers many benefits over older homes. By following this beginner's guide, you'll be better prepared to navigate through each step confidently. With careful planning and guidance from professionals, you'll soon be unlocking the door to your dream new-build home.
If you’re interested in buying a new house and starting your journey up the property ladder, contact our sales advisors at Sanctuary for more information by emailing [email protected].