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Buying a new-build home could help you spend less over the course of owning your property, not simply because it’s brand new, though because it can reduce some of the costs that often come with older homes.
Better energy efficiency, fewer maintenance issues and developer incentives can all make a difference, while the right mortgage can also help keep your purchase on track from the outset.
The savings won’t be the same for every buyer. Looking at the purchase price alongside your mortgage, monthly household costs and future maintenance can give you a better picture of what a property is likely to cost over time.
Developer Incentives Can Reduce Some Upfront Costs
Many developers offer incentives on selected new-build homes, particularly when launching a new development or selling the final properties on a site.
These incentives can include contributions towards legal fees, flooring, kitchen upgrades or other extras that you would otherwise pay for yourself.
While they won’t always reduce the purchase price, they can lower some of the costs involved in moving into a new home.
It’s worth checking how any incentives could affect your mortgage application, as some lenders take them into account when assessing the property’s value or deciding how much they’re prepared to lend.
Our guide on how incentives from a new build affect the mortgage explains how different types of incentives may be viewed by mortgage lenders before you reserve a property.
Mortgage Considerations for New-Build Homes
Getting a mortgage on a new-build home is often straightforward, though some lenders have specific criteria depending on the type of property you’re buying.
For example, certain lenders have different loan-to-value limits for new-build flats than they do for houses, which could affect the deposit you’ll need.
If you’re buying off-plan, the time between reserving your home and completion may also be longer, meaning your mortgage offer needs to remain valid until the property is ready.
Arranging an Agreement in Principle before reserving a new-build home can give you a clearer idea of your budget and help identify lenders that suit both your circumstances and the property you’re buying.
Lower Running Costs After You Move In
A new-build home can continue to save you money after you’ve collected the keys.
Modern insulation, energy-efficient windows and contemporary heating systems can help reduce energy consumption compared with some older properties.
Over time, lower household bills can make a noticeable difference to the overall cost of owning your home.
You’re also less likely to face major repair work during the first few years. Features such as the roof, boiler, plumbing and electrics are all newly installed, reducing the chance of unexpected maintenance costs shortly after moving in.
Why an Older Home May Still Be the Better Choice
A new-build home won’t be the best option for every buyer.
Older properties can sometimes offer a lower purchase price, larger living spaces or locations where new developments aren’t available.
Some have already been renovated, meaning you could benefit from updated heating systems, insulation or other improvements without paying the premium that can come with a brand new home.
Choosing the right property comes down to more than its age. Comparing the purchase price, mortgage costs and ongoing household expenses can help you decide which option offers the better overall value.
If you’re still weighing up your options, our guide on new-build homes vs older homes explains the key mortgage differences, lender criteria and buying process for each.
Buying a New-Build Home?
Buying a new-build home can involve different lender criteria and timescales, particularly if you’re purchasing directly from a developer or buying before construction has finished.
Our mortgage advisors compare mortgages from a wide range of lenders and can help you find one that’s suitable for both your circumstances and the property you’re planning to buy.
If you’re considering a new-build home, speaking to us before you reserve a property can help you understand your mortgage options before you begin the application process.
