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Buying a house without a new build warranty


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Hi thanks, I did read that one but I wasn't sure how a retrospective PCC would go down. The key criteria from our lender seems to be that someone in a professional capacity is willing to say they saw the property being built correctly during the build. If the vendor has had his architect out during the build, and they are willing to sign a PCC confirming that, then we should be fine. Those discussions are going on right now. If he didn't come out at all, then that will be a problem, unless they come up with some shady agreement between them. Which I personally would have no issue with but obviously want no knowledge of. 

 

If they can't get this, then we approach all lenders who look less hung up on this. I'll start with the ones mentioned earlier.  

 

There's a builder working on our road who does this kind of work, and he said lenders have tightened up their criteria severely in the last few years. He's sold houses he's done up without issue, but then when the purchasers have come to sell again, they've been stuck as there is no builders warranty. He said it never used to be an issue. 

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Bummer. seems the architect didn't inspect during the build so he wont sign off on it. They've found someone who will issue a retrospective PCC but our lender wont accept that. It seems lenders have really tightened the noose on this in the last couple of years. 

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Lenders have tightened up on loads of things. When we sold our house a few years ago we had no end of grief from the buyer’s lender and ended up with several indemnities for relatively trivial things. 

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Yeah I'm racking up the indemnities on my own sale, think i'm on four and counting, and that's just an old victorian terrace that i've done nothing to except cosmetic work. I didn't have any of this when I bought ten years ago.  

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Or push another mortgage broker or two - some can’t be bothered, some actually have some proper relationships with the more specialised lenders.

 

The whole indemnity thing is getting silly IMO - no surprise that the lenders are happy to spend other people’s money to cover their own arses.

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42 minutes ago, oksleator said:

Yeah I'm racking up the indemnities on my own sale, think i'm on four and counting, and that's just an old victorian terrace that i've done nothing to except cosmetic work. I didn't have any of this when I bought ten years ago.  

Yes we ended up with four although split the cost with the buyer. It’s a scam in my cynical opinion. 

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Yeah no idea.

Anyway, we've switched broker and they seem to be on it, said this comes up occasionally and have lenders in mind who would be fine with a retrospective PCC. Hoping they come back with an ok rate! I'll report back...

 

 

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Oof we were offered a 5 year fix at 6.1%, compared to the 4.19% for the five year fix we had before. An alternative has been proposed of a 2 year tracker at 4.99%. These are with the only building society who will lend to us, it seems. We are over a barrel and I think the vendors are going to have to share some of that expense. I had a sweaty night thinking about all the risk we're opening ourselves up to. 

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Yeah I think there’s a bunch of responsibility to be pushed back on the seller. If they can’t be arsed to sort out a warranty such that prospective buyers can get mortgages, then they’ll need to accept some of the cost.

 

Suggest v delicate negotiating describing how hard you’re trying to make the situation work and the potential costs to you (and later buyers for the next 7 years) of the sellers not providing a warranty.

 

An easy calc would be 2% premium you’re seeing x 5 years (say) x your mortgage principal.

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surely the Building Control inspected whilst it was being built.

They check at various times such a foundation pour, floor slab etc.

Do you know who the BC was and can you get anything from them.

Surely it couldn't be built without inspection, if it wasn't then despite looking good maybe it should be avoided.

 

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  • 2 weeks later...
  • 2 weeks later...

hi hi! Sorry I haven't logged on for a while. The building regs were signed off by a image.png.4da993c6fc00248dcb486b7aa689e618.png

 

So does that mean they inspected the build throughout the process? It was signed off in March 2021. 

 

We're still not much further in the process. Everything is taking ages. 

 

Another thing that has come to light is regarding water. They've just extended the water pipe from the neighbouring house (which they used to own) and don't seem to have told the water company, so it has no independent water supply, which seems majorly dodgy to me? I guess they were just going to let us move in and then discover the neighbour pays for our water (I presume it is unmetered at least). What the hell? I have kicked off about this and they have notified the water supply company about the dwellings existence, but I don't even know what the next steps of that is. Does the water company need to inspect the pipes and obtain a wayleave agreement from the landowners? The property has a kingspan sewage treatment plant for waste. 

 

This sale is an absolute mess and I don't trust them at all now. 

 

 

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13 minutes ago, oksleator said:

This sale is an absolute mess and I don't trust them at all now. 


Go with your gut. Keep searching, they’ll be something else out there. 

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Yeah you're probably right. We're having some issues with our sale now too as our next door neighbours decided to put a massive bloody dormer planning application in this week (which will definitely get rejected but not until 15th august) so that's delaying things. I think this house move is doomed. 

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They did the water thing to save money: it's possible to have a sub meter, but it's frowned upon, but it didn't matter when they owned both houses. 

 

It would be better to sort out your own supply which will probably mean a road dig and house dig. You can ring the water co and get a quote (few £10000) and knock that off the price or get them to pay. It's not the end of the world, but more hassle.

 

It might be worth confirming that none of the other services are shared?

Edited by Jilly
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Posted (edited)

Thanks Jilly. Good point about the other services (there's just electricity). There's an ASHP and solar panels at the property but everything has the wrong name on it (it's all registered to their other property) so it's very hard to keep track of what's what. Our conveyancers list of outstanding questions is still enormous. I am really fed up with the vendors now. 

 

I tried to get some quotes for putting in a new water supply but you have to be acting on behalf of the property owner to get anywhere with the request forms. 

 

 

Edited by oksleator
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  • 1 month later...

Hello, just giving a conclusion to this. We pulled out of the sale, not due to the lack of structural warranty in the end, but due to high flood risk (a brook and a culvert converging right next to the building which is at the low point of the land) and the geological report indicating medium risk of subsidence due to compressible deposits. Spoke to a surveyor who said their structural report on the existing build pre conversion wasn't worth the paper it was written on, the flood risk was a serious concern, and to run away. Spoke to a couple of friends who are geo-environmental engineers and they suggested questions to ask them about the build to check the foundations were suitable, but they didn't answer. Also knocked on the doors of the neighbours who said don't buy it, it's flooded several times and the bridge to access it needs rebuilding every couple of years these days due to surface water flowing down the hills. And they never did come up with the initial notice information for the building regs final certificate, so we have no idea what was actually certified. 

 

Thank you all for your help. I've learnt a lot! And spent a lot of wasted conveyancer fees, but such is life.

 

They've relisted it as is, so it will be interesting to see how long it takes to sell. I guess they will be looking for a cash buyer who asks fewer questions and is less concerned about floods.

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Well done for doing your research.  Lots of people get hooked into thinking because they have waited a few months and spent 2 or 3 thousand, they are committed to purchasing.  The purchase price is likely to be hundreds of thousands, so just write off the fees and be pleased that you have not bought a liability.

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