It’s summer sales time and developers are clearly feeling generous, with some juicy August freebies for their new homes buyers. Buffeted by stamp duty hikes, an oversupply of expensive luxury new build, a withdrawal of overseas buyers and a slowdown in the market that started a long time before Brexit, builders are keen to lure in buyers with added extras.
Free parking, stamp duty refunds, free travel passes, legal fee refunds and even John Lewis vouchers for interior design are all out there. However, location is still key. Enjoy the sweeteners but remember, if you buy into an up-and-coming area or a new Crossrail zone you will reap bigger rewards from your long-term investment.
It pays to haggle
The incentives may not be on offer for long. Already, there are signs of overseas buyers returning to the market, taking advantage of the weaker pound. And builders know that after the August holidays September will heat up. So grab the deals now.
Despite the “gifts” you should still try to negotiate a price cut. The more expensive the home, the bigger the discount is likely to be — perhaps 10 per cent, possibly as much as 20 per cent.
Huw Davies of South Bank estate agent Caddington Blue, says: “In a way, it’s a return to a normal market. Sellers set a price, buyers make an offer, and negotiations start.” And you are much more likely to get a reduction if you are ready to buy, with your mortgage and everything else in place.
With about 5,000 homes under construction at 20 sites across London, Barratt has unveiled a raft of sweeteners including travel concessions for commuters and “sale-and-leaseback” deals on show apartments, which may appeal to cash buyers or those who want to plan their move for two or three years in the future.
With a leaseback deal, you buy the property but move in at a later date, getting a rental income, typically six per cent return, in the meantime while the developer continues to use the home for marketing purposes.
The home is handed back to you in pristine condition, fully furnished. The deal is available at Kidderpore Green in Finchley, where two-bedroom flats start at £1.35 million; at Camden Courtyards, near Camden Town, a former optical works turned into 164 flats priced from £620,000, and at Blackfriars Circus in Southwark — a landmark scheme of 336 homes priced from £585,000. Call 0844 811 4334.
It’s a short walk from Barratt’s Aldgate Place, a swish scheme of 463 flats, to the Square Mile skyscrapers. But buy a home there and you get a free all-Zones travel card lasting three years. Move in before September and your new home will come with a furniture pack valued at £20,000. This new City fringe “quarter” has a hotel, cafés and restaurants, communal gardens and a fitness centre. Prices from £695,000. Call 0844 225 0032.
Cycle purchase vouchers and Oyster Card incentives are on offer at Hendon Waterside, a 2,000-home neighbourhood being built beside Welsh Harp Reservoir in NW9, with prices from £491,500. And if you buy a house at Putney Rise off Putney Hill, Barratt will take your existing home in part exchange. Prices from £974,000. Call 0844 811 4321.
At Regency Walk, a gated mews near the Palace of Westminster, developer Thornsett is offering free underground parking spaces that would cost £65,000. Two-bedroom flats start at £1,165,000. Call Hamptons International on 020 3451 1544.
Developer Hill is offering buyers at Ninewells in Cambridge a free Renault Twizy electric car plus stamp duty. Call 01223 841842.
Galliard’s summer sale across six developments in cheaper London locations such as Slough and Hounslow is proving a hit with first-time buyers and second steppers, says the firm’s David Galman. “Prices start at £139,995 and all six schemes have quick travel times to central London.” Call 020 7620 1500.
Developer Countryside is giving stamp duty refunds at St Paul’s Square in Bow, at East City Point in Canning Town, and at Acton Gardens in W3. Prices start at £432,000. Call 020 7473 1198.
At The Mount in Mill Hill, an incentive package combines stamp duty with £5,000 in John Lewis vouchers and free membership of the nearby Virgin Active gym. Four-bedroom townhouses start at £980,000. Call 020 8371 9269.
Areas to watch
Corio, a scheme of 167 flats at Bermondsey Spa, falls into this category. For many years this part of the SE1 postcode — south of Tower Bridge Road, the congestion charge boundary — was deemed the wrong side of the tracks but fashionable loft developments have attracted well-off creatives and sparked neighbourhood improvements. Corio’s flats have generous recessed balconies overlooking communal gardens, and developer Linden is giving buyers £15,000 to spend on interior design. From £515,000. Call 020 3811 6272.
Stockwell is another improving area, up to 20 per cent cheaper than Clapham yet on the cusp of Zone 1 and served by the Northern line, with handsome conservation areas alongside council estates. Park Heights is a 20-storey tower offering good-value, generous-size flats with big wraparound balconies and a communal residents’ sky garden. Network Living will pay three per cent stamp duty on two-bedroom flats priced from £635,000. Call 0344 809 2026.
The same stamp duty offer is available at BASE17, in gritty but undervalued Walworth. Prices from £530,000. Call KFH on 020 3486 2250.
Beware the bargain
Don’t rush to grab the sweetener without scrutinising the plans and small print, considering the service charge, and above all buying in a good position on the site.
One potential downside of incentives is that a mortgage lender may judge that the property is overpriced in the first place and offer a smaller loan.
Transparency rules require builders to disclose any inducement they offer buyers at the time of purchase. This lets lenders see exactly what makes up the purchase price. While a stamp duty refund may be considered a genuine incentive, £20,000 cash back may not be. If you do not like or need the incentive, ask the developer to convert its value into a price reduction.
August is a buyers’ market — so make the most of it.