Advice on buying 'off-plan'

I am buying a new property “off plan”. Will the procedures be different to buying an existing property?

I am buying a new property “off plan”. Will the procedures be different to buying an existing property?

Once you have chosen the plot you wish to reserve, you will have to pay a reservation fee, which is normally non-refundable. The developer's solicitors will then send your solicitor the contract, including copies of the planning permission and general information about the site. Most developers insist on exchange of contracts within 28 days. If you are selling a property as well, your buyer will have to agree to his or her deposit being passed to the developer on exchange of contracts as developers normally insist on the deposit being released to them on exchange, rather than being held by their solicitors. If this proves a problem you may have to find the deposit yourself for your purchase, rather than using the deposit supplied by your buyer. Your buyer will also have to agree to move on the same date as the completion date given to you by the developer

What about my mortgage application?

Your mortgage company will arrange for the property to be valued. The valuer may have to revisit the property just before completion to ensure that all works have been finished and the property is habitable. You should check that your offer does not expire before the new property is ready. If it does, you will have to ask the lender to reissue the offer.

What is an NHBC guarantee?

Large developers offer their buyers an NHBC guarantee, which is insurance against structural defects for the first 10 years of ownership. Most mortgage companies will require an NHBC guarantee or similar type of cover.

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Anything else I need to know?

Your solicitor will check agreements are in place to ensure that the roads and sewers are to be adopted by the authorities.

What will happen when the house is ready?

Once the property is ready, the developer will serve notice upon you and you will be told of the completion date, when the property will become yours. You will be given the chance to check over the house and the developer may agree to attend to any “snagging” points.