The process of buying a new build property is different to that of a second-hand property. One of the reasons for this is that often the house will not be ready for occupation by the time exchange of contracts takes place because it is still in the process of being constructed. In these cases, completion will take place ‘on notice’.

The developer usually gets a certain amount of time, as stipulated in the contract, to finish the property to the expected standard. When the house is ready, the developer’s conveyancers serve a notice to complete on the buyer’s conveyancer stating that, as the property is now ready, the buyer must complete and pay for the property within a set number of days, usually 10.

By the time exchange of contracts takes place, your conveyancer should have already carried out all the usual legal enquiries and searches. On exchange of contracts you are required to pay over your 10% deposit to the developer.

Completing On Notice Can Present A Number Of Challenges:

1. If you are selling a property and intend to move from your old property into your new home, you may need to either sell your old property first (break the chain) or ask your buyer to complete on notice at the same time as your new home is ready. Some people are reluctant to agree to this as there is uncertainty about when the move will actually take place but, as contracts will have already been exchanged, they will at least have the comfort of knowing that nobody will pull out last minute.

2. If the build gets delayed beyond the anticipated completion date then you might find your mortgage offer could expire as most are only valid for 6 months. You will need to make sure you keep an eye on the expiry date and extend or reapply, if necessary.

How Can Timms Help?

If you are considering purchasing a new build property and have any questions, please feel free to contact me for advice and guidance on 01283 561531 or via email at k.holmes@timms-law.com.