Thinking About a New Build?
New Build vs Existing Homes: Worth the Higher Price?
New builds cost more per square foot, but you get a warranty, lower running costs and builder incentives. Existing homes often give you more space and room to negotiate. We will help you weigh it up, and make sure the mortgage side works for whichever one you pick.
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Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The actual amount you pay will depend upon your circumstances. The fee is up to 1% but a typical fee is 0.3% of the amount borrowed.
Client Reviews
What Our Clients Say
"As first-time buyers, we were really anxious about the whole mortgage process and just didn't know what to expect, but Tony made everything straightforward and easy to understand. Tony and Katie were always quick to respond and kept us up to date at all times! The whole process has been quick and stress-free and I would definitely recommend to anyone!"
First Time Buyer
"Tony was an excellent mortgage broker from start to finish. He explained everything clearly, was always responsive, and made the process smooth and stress-free. As a first time buyer I felt confident knowing he had my best interests in mind and secured us a great offer."
First Time Buyer
"As a first time buyer the whole mortgage application process was daunting, but Tony was patient, knowledgable and attentive. No question was ever too silly (and I had plenty of them!) and he took the time to really make sure I understood each step of the process."
First Time Buyer
The New Build Premium
Why New Builds Cost More, and Why It Matters to Your Lender
You are paying for a home nobody has lived in, with a warranty and modern energy standards. That premium can shrink once the house is no longer new, so lenders are more careful with new builds.
- ✓Some lenders cap the loan to value lower on new build flats than on houses
- ✓Builder incentives have to be declared to your lender and can affect how much they lend
- ✓The lender valuation can come in lower than the builder price
- ✓Completion dates can move, so your mortgage offer needs to last
- ✓We know which lenders are comfortable with which developments
How We Help
From Reservation to Keys on a New Build
Five steps, and you will know where you stand before you pay a reservation fee.
Work Out Your Budget
Your borrowing figure and deposit, including any extra a lender might want on a new build flat.
Mortgage in Principle Before You Reserve
Builders want to see you are good to go, and you do not want to lose a reservation fee.
Check the Development With Lenders
Not every lender is keen on every site. We check before you commit.
Apply With the Incentives Declared
Deposit contributions, cashback or free extras all go on the lender paperwork, so there are no surprises.
Keep the Offer Alive to Completion
If the build runs late, we keep an eye on your offer expiry and sort an extension if needed.
Side by Side
New Build or Existing Home?
Neither is the right answer for everyone. These are the things that usually tip it one way or the other.
Warranty
New builds come with a builder warranty, usually 10 years. Existing homes rely on the Home Report survey.
Talk It Through →Running Costs
New builds are usually more energy efficient, which helps bills and can open up green mortgage deals.
Check My Options →Space for the Money
Existing homes often give you bigger rooms and gardens for the same price.
Check My Budget →Room to Negotiate
With an existing home you can offer under on a fixed price or go in at a closing date. New build prices are rarely moved, but incentives can be.
Talk It Through →Repairs and Snagging
New builds may have snags to fix in the first months. Older homes may need bigger work down the line.
Ask a Question →Resale Value
A new build premium can drop away once the home is resold. Existing homes in good areas tend to hold value steadily.
Get Straight Advice →Common Questions
New Build Mortgage Questions, Answered
The things buyers ask us before they reserve.
Are new builds worth the extra money?
It depends what you value. You pay a premium for a brand new home, a warranty and lower running costs. If space and resale value matter more, an existing home can be better value.
Can I get a mortgage on a new build?
Yes. Most lenders lend on new builds, though some are more cautious on new build flats and may ask for a bigger deposit.
Do I need a bigger deposit for a new build?
For houses, usually not. For new build flats, some lenders lend a smaller share of the value, so you may need more deposit.
What happens with builder incentives?
Things like deposit contributions, cashback or paid fees have to be declared to your lender. Some lenders take them off the price before working out how much they will lend.
What if the house is not finished in time?
Mortgage offers last a set time, often around six months. If the build runs late, many lenders will extend the offer, but it is worth planning for.
Will the lender valuation match the builder price?
Not always. If the valuation comes in lower, the lender works from that figure and the gap would need to come from your own money.
What is a reservation fee?
A fee to take the plot off the market while you sort your mortgage. Check how much of it you get back if things fall through.
Should I get a snagging survey?
It is worth it. A snagging survey picks up unfinished or faulty work so the builder can fix it under warranty.
Related guides
- How much to offer on a house in Scotland
- A guide to buying a new build home in Scotland
- Get a mortgage in principle before viewing
- How much can I borrow?
- All mortgage questions answered
Written by Tony Flynn, mortgage broker at Tony Flynn Mortgages, helping homebuyers across Lanarkshire and Scotland. This page is general information, not personal advice. Speak to Tony about your own circumstances.
Get in Touch
Book a Chat Before You Reserve
Fill in the form and we will be in touch within one working day. If you have a development or a house in mind, send us the details and we will tell you how lenders are likely to see it.