By the end of this chapter you’ll understand:

✓ What happens during your reservation appointment

✓ What you should ask the developer

✓ What to do after reservation

Estimated Reading Time: 8 minutes

What is a reservation?

A reservation is an agreement between you and the developer that gives you the exclusive opportunity to purchase a specific property. Once your reservation has been accepted, the developer will normally stop marketing that plot to other buyers while you progress your purchase.

It’s important to remember that a reservation isn’t the same as exchanging contracts. At this stage, you’re simply securing the opportunity to buy the property while your mortgage application and legal work are completed.

What happens during your reservation appointment?

Your reservation appointment is usually held in the developer’s sales office. During the appointment, the sales adviser will normally:

• Confirm the plot you’ve chosen.
• Explain the purchase price.
• Discuss any available incentives.
• Explain what’s included with the property.
• Confirm the expected build stage.
• Explain the reservation fee.
• Outline the next steps.
• Discuss expected exchange timescales.

This is also your opportunity to ask as many questions as you need. There’s no such thing as a silly question when you’re making one of the biggest purchases of your life.

What is a reservation fee?

Most developers ask buyers to pay a reservation fee when reserving a property. The amount varies between developers, but it’s commonly between £500 and £2,000.

The reservation fee demonstrates your commitment to purchasing the property and allows the developer to remove it from the market. It’s important to ask:

• Is the reservation fee refundable?
• Under what circumstances could I lose it?

Your sales adviser will explain the reservation agreement before asking you to sign it.

What should you ask the developer?

Your reservation appointment isn’t just about completing paperwork. It’s also your opportunity to learn as much as possible about your future home. Some useful questions include:

About the property

• What’s included in the purchase price?
• Which upgrades are optional?
• Can anything be changed?
• What’s the expected completion date?

About the development

• Are there future phases planned?
• When will the roads be completed?
• Will the roads be adopted?
• Are there management charges?
• What local facilities are planned?
• Will there be schools, shops or GP surgeries?

About the buying process

• How long do I have to exchange contracts?
• What incentives are currently available?
• What happens if the completion date changes?
• Who will keep me updated throughout the build?

Choosing a solicitor

One of the next decisions you’ll make is choosing the solicitor or conveyancer who will deal with the legal side of your purchase. Your solicitor plays a vital role throughout the buying process.

They’ll:

• Review contracts.
• Carry out legal searches.
• Raise enquiries.
• Exchange contracts.
• Request your mortgage funds.
• Complete the purchase.

In short, they help ensure everything is legally correct before you become the owner of your new home.

Should you use the developer’s recommended solicitor?

Many developers recommend one or more solicitors that they work with regularly. This doesn’t mean you have to use them. You are free to choose your own solicitor if you prefer. There are advantages and disadvantages to both options.

A recommended solicitor may:

• Be familiar with the development.
• Already have access to the developer’s legal documents.
• Understand the developer’s preferred timescales.

Your own solicitor may:

• Already know you.
• Have acted for you previously.
• Be someone you’ve personally researched or been recommended.

There’s no right or wrong choice. The most important thing is choosing a solicitor who is experienced, communicates well and has the capacity to progress your purchase within the required timescales. However, as we said earlier, ensuring everyone works well together will make your experience much smoother, so always consider the recommended solicitors when buying new build.

Why is everyone talking about exchanging within 28 days?

You’ll often hear sales advisers mention a 28-day exchange deadline.

This simply means the developer expects contracts to be exchanged within around four weeks of your reservation. Why? Because once you’ve reserved the property, they’ve stopped marketing it to other buyers. To meet this deadline, everyone involved needs to work together.

That includes:

• You.
• Your mortgage adviser.
• Your solicitor.
• The developer.
• Your lender.

Responding quickly to requests for documents and information can make a huge difference.

What should you do after reserving? – Once you’ve reserved your property, there are a few things you can do to help keep everything moving.

• Contact your mortgage adviser – If you haven’t already submitted your full mortgage application, this is usually the next step.
• Instruct your solicitor – The sooner your solicitor can begin work, the more time they’ll have to complete the legal process.
• Stay in touch – If your circumstances change, for example, your employment, income or deposit, let your mortgage adviser know as soon as possible.