The purchase of new build homes can be an entirely different beast to buying a conventional new home. This has been made more apparent as, over the years, there have been a number of changes to the property market and the conveyancing profession due to the demands of new build houses, stamp duty changes and Government schemes designed to assist buyers.
New build conveyancing transactions are different to the usual high street purchase. For example, there are high demands with new builds as contracts are usually exchanged before the plot is even built. This means that a completion date cannot be set at exchange, as is usually the case, which leaves the buyer waiting in a state of uncertainty until their home is at last built. This tends to limit the type of purchaser of new build homes to those people without current commitments; hence the popularity of new build homes amongst first time buyers.
There are also different obligations and, sometimes, strict deadlines for different builders, coupled with various limitations from the Help to Buy requirements. This means that solicitors and conveyancers are continually adjusting to the changes and ensuring that the deadlines are being met.
The stamp duty changes in particular have made it costly for investors to purchase a second house, and even more so for the purchase of further properties. For example, if you are thinking of purchasing a buy to let property now, you will expect to have to pay a higher rate of stamp duty. Conveyancing solicitors are finding that the knock on effect of this is that new build purchases are becoming increasingly more popular for first buyers.
The Help to Buy Scheme and the Help to Buy ISAs are also becoming more and more common with first time buyers. There are a number of advantages for using the Help to Buy scheme, but the primary advantage is that the Government contributes 20% of the purchase price and there is no interest payable until the 5th year after completion. Buyers also only need to generate a 5% deposit rather than the usual 10%.
With the Help to Buy ISA, the Government also pays a bonus on the monthly payment made by the buyer. When a client has the benefit of the Help to Buy scheme, this means that solicitors not only act for their client but also the first lender and Help to Buy (second lender) as they place a second charge on the property.
As you can see, the legal profession has to continuously adapt to meet the on-going demands and requirements of the property market.
As New Build solicitors at BHW Solicitors, we have a dedicated team that will work with you to overcome the obstacles of your new build purchase, as well as a dedicated Residential Conveyancing team to help with all other aspects of your conveyancing transaction.
If you have any questions, or would like to receive a quote for our conveyancing services, please call a member of BHW’s Conveyancing team on 0116 289 7000.