Buying a new build home: 8 things to know
Find out the pros and cons of buying new, and how mortgage lenders treat new build homes.
Last updated on
Jul 15, 2025 12:21
For a lot of people, the best thing about a new build is being the first person to make it a home. In some ways, the buying process is simpler, too.
That said, it’s not always smooth sailing. So, here are the pros, a few cons, and a simple guide for what to expect when you decide to buy a new build property and apply for a mortgage.
There are a lot of advantages to buying a new build home compared to buying a period, or “old build”. We've listed them below, these include:
When you buy a home that’s not new build, you’re usually dependent on other people buying and selling before you can exchange contracts. These “chains” can be dogged by huge delays. At best, this can be stressful. At worst, you can lose your mortgage offer or the sale can fall apart. If you’re buying a new build from the developer and the property is ready, the most you have to worry about is a delay in selling your current home (if you’re not a first-time buyer). If the property isn’t ready, you could encounter delays, though.
There are two ways of buying a new build home:
If you buy off-plan, you’ll look at architectural drawings, artists’ impressions, and lists of options. While this means you won't see the views and natural light before you move in, it can be handy to have a say in your kitchen fittings, bathroom tiles, and carpets.
Because building codes keep new builds as energy efficient as possible, your home is almost always going to be pretty cheap to run. You won't need to update things before you can live in your house or lower your bills. And even if the magnolia paint the developer picked isn't quite to your taste, you won't have to live with the previous owner's choice of wallpaper either.
Whether that’s help in selling your existing home, throwing in some landscaping services or kitchen appliances, or even paying your stamp duty, some developers like to sweeten the deal.
Around 70-80% of housing developers in the UK are registered with the National House-Building Council (NHBC). One of the upsides for the buyer is that the homes sold by NHBC-registered developers are under a 10-year Buildmark warranty. This usually means:
There are other warranties that developers can choose instead, but your new build will definitely need one - mortgage lenders require a 10-year structural warranty.
Let’s be completely honest: while new build homes in the developer’s marketing materials always look amazing, there are some disadvantages, too.
Period homes have period features – high ceilings, large rooms, ceiling roses round the light fittings, original fireplaces, stained glass in the doors... They might also have established gardens with mature trees to give you privacy and shelter. New build houses don’t, and it can be quite a lot of work and investment to put this “personality” into your home.
Just like when you buy a car, a new build property will usually lose some value as soon as it’s no longer brand new. They also come with what’s often called a “new build premium” – a slight price inflation from the developer who knows how much people want to be the first to call a home their own.
Even though you’re hopefully moving to your new build with the view to living there for a long time, it’s still worth considering the initial problems you might face. We’ve listed the main ones below.
All new builds need a certain degree of snagging (fixing minor faults and finishing off anything unfinished). You can either pay for a professional snagging survey or make your own list during your first months in the property.
If you’re one of the first people to move into a new development, you might find yourself living at the bottom of a building site. It’s worth asking the developer how much longer they plan to be working in the area after you move in.
If you move to an existing property, someone else will have already set up the utilities. With a new build, you might be the first to have them installed, and the process can take a little longer. In some cases, even getting your post delivered is tricky because your address hasn’t been registered yet.
So, those are the pros and cons. Next, let’s take a look at the process of buying a brand new home and what you can expect at every stage, including applying for a mortgage.
The first stage of the process is generally about doing your research. Below, we’ve covered some of the key aspects to consider.
New builds are typically built by big developers that operate all over the UK. This means it’s easy to ask people who already live on their estates about their experiences, read about the quality of the buildings online, and even visit the streets to see how the houses are weathering.
When you make what is probably the biggest purchase of your life, you want to know that it’s going to hold its value. You can use sites like Zoopla and Rightmove to check out what properties in the area, including any new builds, have been going for.
Shared ownership schemes (UK-wide) and Help to Buy equity loans (Wales only) reduce the size of the deposit that buyers need to save.
With shared ownership, you buy part of the property (usually between 25% and 75%) and pay rent on the part that you don't own.
Help To Buy is just for first-time buyers in Wales, who can get a 20% equity loan from the government when buying a new build property as long as they have a deposit of at least 5% and can get a mortgage for the other 75%.
In both cases, you have an extra bill every month, but having access to a larger deposit at the start could get you a mortgage deal with lower monthly repayments and a lower interest rate to make it more affordable overall.
There’s also the First Homes scheme in England, which enables first-time buyers who meet the criteria to get a discount of at least 30% on the market value of a new-build home.We’ve done a full guide for those who have a small deposit.
The process for buying a new build is similar to the process for any other property.
Once you’ve found a place where you can imagine yourself living, it’s a good idea to apply for a mortgage in principle to show the developer that you’re a serious buyer.
You can get a mortgage in principle for free from Habito.
You'll then pay a reservation fee (usually between £500 and £2,000) to the developer to hold the property for you. This is typically valid for about four weeks, during which time your mortgage application will be processed, and your conveyancer will take care of the legal side of the purchase.
Your lender will also want to know two dates if you’re buying a new build:
Once your application has been approved, and your conveyancer has finished the legal checks and transferred your deposit to the developer’s solicitor, you'll sign and exchange contracts, and the house will be yours.
We’ve got much more on the mortgage application process here: How to get a mortgage
"Mortgages for new builds can be a bit different. Some lenders ask for a bigger deposit, especially on new build flats, and rates can vary. The good news is that there are special mortgage schemes such as Own New which are designed to offer competitive rates.
More good news is that, because new builds are energy efficient (typically with an EPC of A or B), they can be eligible for “green deals” – some of these are solely for new builds – which offer cashback or a reduced rate.
Apart from rates and deposits, the other key difference is offer expiry. The danger with buying a new build is that you might lose your mortgage offer if the developer encounters problems and goes over the long stop date. But thankfully there are specialist new build mortgages available that take this into account and give you extra flexibility.
It’s smart to talk to a broker like Habito to ensure your new build mortgage all goes smoothly."
Once you’ve bought your new build and you have the keys in your hand, moving in is pretty simple. You’ll still have to pay Stamp Duty and the legal fees that you owe to the conveyancer, and of course, you’ll have to decide on the best place to put your furniture. The only additional tasks you wouldn’t have to tackle for a period property are snagging and making sure that your new address is recognised and registered.
Habito can guide you through the process of buying a new build. Whether you need a mortgage in principle, tips from a mortgage advisor, or a mortgage broker to help you find the best deals for first-time buyers, find out how we can make home-buying easier today.
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Thinking of buying your first home but not sure where to start? Here’s a simple, step-by-step guide to the process – from sorting your finances, to viewing properties, to getting the keys to your new home.
Habito specialises in helping you get the best mortgage or remortgage, all online, for free