A New Build is a property that has never been lived in, compared to an Old Build, which has had at least one residing owner before. If you’ve fallen in love with a New Build, you might ask yourself, “but what are the pros and cons?” – and to answer that question, we’ve compiled a list of things to consider before purchasing your dream home.
Pros
Ready from day one
You’re the first individual or family to live here, meaning everything is new and unused. There will be fresh wallpaper, unstained and unscratched floors, brand-new carpet, and no repairs or maintenance to start your new life.
Low bills
New builds are generally much more energy-efficient than old homes. They are required to comply with new building regulations, leading to over 80% of New Build homes having an EPC rating of A-B, according to data from EPCs.
Warranties
The property will come with a fresh New Build warranty for building defects you find within the first two years. From years 3-10, you’re insured for any structural issues including foundations, the external render, roofs, ceilings, chimneys, and load-bearing parts of the floors.
The insurance period can also be longer, but on average it spans 10 years, typically from the date of build completion.
This warranty does not, however, cover any natural wear and tear, weather damage or issues reasonably caused by the owner’s negligence.
Chain-free
New builds won’t have a chain of buyers above you, since you’re the first buyer! This means fewer fall-throughs, delays, and risks.
Buyer Incentives
Some developers will give incentives to potential buyers, and for first-time buyers, there are schemes available that you might qualify for.
Developer incentives can include a cash payment to help fund your deposit or move, or they can offer to cover legal fees or Stamp Duty payments.
Some of the schemes available to first-time buyers include:
- First Homes scheme - buy your first property at 30-50% less than market value
- Deposit Unlock - buy a new build with a 5% deposit
- Own New Rate Reducer – offers buyers access to rock-bottom mortgage rates
Cons
Space
New Build are often built in groups, where the number of rooms impacts property value more than practical space. This means that New Builds frequently have smaller rooms and fewer storage solutions. They are also often built in new areas without existing infrastructure or amenities, so remember to inspect the area’s distance to public transport links and stores.
Value fluctuations
The premium of a New Build comes from the fact that no one has lived in it before. The moment you buy the property, the property is no longer unused and thus will be worth less than the unsold New Build across the road. If you decide to buy a New Build, it’s a good idea to plan to live there for a longer period, so the appreciation of the property will balance out.
Build quality
The Home Builders Federation National New Homes Customer Satisfaction Survey published in March 2024, found 95% of new build buyers reported problems such as snags and defects to their builder since moving in. It has become an expectation to see these issues in New Builds, leading to it being encouraged to hire a snagging inspector before moving in, so they can rectify any issues with the builder on your behalf.
You should also consider that conveyancing New Builds isn’t as straightforward as with old properties with an established history.
On top of that, you should be wary of property developers recommending you a conveyancer, for example under the notion that it will either cut time or increase your chances of getting the deal. If you spend the time finding your conveyancer, you can be sure that they have your best interest in mind.
Delays
It’s not unusual for New Builds to overrun their expected completion date, and this can cost you money and stress in storage solutions and periodic accommodation. Be prepared that that could happen and have solutions in place.
Summary
The purchase of a New Build should be made with full clarity of the risks and with plenty of research into the area it’s built in. Due to New Builds coming with a 10-year warranty, you can with the support of a snagging inspector and surveyor get your new home in tip-top shape at little cost to yourself. If you’re a first-time buyer, a New Build is a great way to get onto the property ladder with the buyer incentives available, but make sure that you have solutions in place in case the completion date is delayed.