How to negotiate the best 'New Build' house price with developers in 2023
Licensed Conveyancer, Head of Conveyancing rmitchell@lawson-west.co.uk
A New Year, a New Home?
We have started to see a return to pre-pandemic levels in home sales and purchases following the buoyant housing market of the past two years which was triggered by pandemic STAMP duty discounts and favourable mortgage interest rates.
Higher Bank of England interest rate rises in the latter part of 2022 started to have an impact on the affordability of mortgages and this has helped to slow the market as people think twice before moving home during the cost-of-living crisis and higher mortgage interest rates. Match this with an anticipated 12-20% fall in house prices in 2023 (a) and you can see the market is starting to cool-off.
Buying a New Home in 2023 – incentives are available
The impact of these economic factors is having an effect on new home developers and builders in 2023 as competition to attract new purchasers intensifies.
We have already started to see new home developers and builders offer incentives to attract new home purchasers as the property market cooled towards the end of 2022:
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Carpets and floorings included
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Flexible mix and match contribution – a contribution to your cost of living expenses for a set period of time arranged as part of the new mortgage with a lump sum payment to the purchaser upon completion, depending on the purchase price this can be many thousands ££££s
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Price reductions on selected plots or house styles
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Upgraded kitchens, included appliances, upgraded flooring options
If you are thinking of purchasing a new build property in 2023, you should investigate what incentives are being offered locally on all new build properties and sites and compare and contrast them, using this opportunity to negotiate the best price. There are decent reductions to be had, often with a value of £££ thousands of pounds and this could really help your financial position to make that new home purchase a reality!
Rachael adds: “Be warned, once Bank of England interest rate levels start to reduce again in 2023 as UK inflation stabilises (predicted towards the end of 2023 (see b)), falling interest rates will mean that developers may no longer offer incentives and reductions – in other words, buy your new home in the first half of 2023 to get the maximum incentive benefits as later this year they might not be available.”
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