Exchange with a delayed completion

Discussion in 'Legal & Regulatory' started by Buyer, Jun 8, 2018.

  1. Buyer

    Buyer New Member

    Hi all,

    I am looking for some advice whilst potentially purchasing my first property. I am interested in a property that is currently occupied by someone buying a new build. The new build will not be ready Until early next year. The timing isn’t an issue at all for me... what I’m not sure of is whether there are risks to me offering to purchase this property - I appreciate there are risks involved with any purchase but would this be too high risk for a FTB. The developers (well established property company) that the current tenants are buying their new build from have in theory taken over the selling of the property I’m interested in as they have technically purchased it from the current tenants as part of the new build contract. The estate agent confirmed that exchanging now with a delayed completion is common for this ‘new build’ kind of scenario. I’m just anxious with this being my first experience of a potential property purchase.

    Any advice or thoughts would be greatly appreciated.

    Thank you
  2. FWL

    FWL Member

    The obvious issue I can see there is delays with the new build in the future (the developer going bust as one extreme) - where would you stand? Do you have alternative accommodation available if there was a delay? Who would cover the extra costs? Would the current "tenants" leave on the agreed date even if there was a delay in moving into their new property?
  3. Longterminvestor

    Longterminvestor Administrator

    Delayed completion is common place as this kind of agreement offers both parties a degree of certainty. Surely it is up to the seller to move out by the agreed date, even if their new build has not been completed? If the completion date is allowed to drag on then the buyer will suffer, paying finance costs on an asset which has not been delivered as agreed.

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