Buying an new-build: does the snag list happen before the signing of the contracts ?

ZoZoZo

Hi,

I'm trying to understand the sequence of steps when buying a new-build. Specifically, do you sign the contract before drawing up a snag list and being satisfied that all the items have been addressed ? Or does it happen afterward ?

The sequence seems to be:
1. Make an offer
2. Go sale agreed and they send the Contract for Sale and Title Deed to your solicitor
3. Once work is complete they send a Completion Notice to your solicitor
4. You inspect and draw up a snag list
5. They fix the snags
6. You sign the contracts and pay deposit.

Or does 6. happen before 4 & 5 ?
It just seems like 4 & 5 could take a while but the vendor would likely want to lock you in to the sale as soon as you have gone sale agreed but as the buyer I don't want to be legally committed until I'm sure everything is up to standard.
So, how does this work ?

Thanks,

Zozo.

amcalester

Snagging is done at the end, just prior to closing.

Once you’re happy that the snagging has been complete you can instruct your solicitor to close the sale.

Contracts will have already been signed well before then.

Effectively you’re contractually committed to the sale but you can delay until you’re happy that it’s up to scratch.

ZoZoZo

amcalester wrote: »

Snagging is done at the end, just prior to closing.
Effectively you’re contractually committed to the sale but you can delay until you’re happy that it’s up to scratch.

Does that not leave the buyer in a very bad position, ie your are contractually committed to completing the sale by the completion date but the work may not yet be up to standard, once the contracts are signed the builder can do a half-arsed job and then just run down the clock ?

amcalester

ZoZoZo wrote: »

Does that not leave the buyer in a very bad position, ie your are contractually committed to completing the sale by the completion date but the work may not yet be up to standard, once the contracts are signed the builder can do a half-arsed job and then just run down the clock ?

The completion date just gets moved back until you’re happy, builder doesn’t get paid until you say so.

At that point the builder just wants the house finished so he can move on to the next one, anything raised in the snag will be done ASAP.

It’ll probably be moved back a few times by the builder anyway. Then your bank will mess up the transfer to your solicitor or realize they’re missing some paperwork and that’ll be another delay.

Dolbhad

Yes you may have a rough completion date of completion but essentially you are signing contracts and legally bound before the house is built i.e. buying off plans. So you should make sure your happy with the plans and specfications given with contracts. Ideally the builder will have a show house but if your in phase one they won’t have it ready so check out other developments they have done.

The contracts will have a estimated date like builder has 18 months to build the house. You give 10% of the contract deposit to builder.

I would recommend if your worried about the quality, pay extra and have your own engineer go out a few times and check up on the build as it’s going up. They can flag an issues to you. But generally builder will say house is done, you get your engineer to snag the house and list is given to builder to fix. Your solicitor won’t release the balance of funds until your happy.

Builder will want you signing contracts within a few weeks of going sale agreed.

awec

ZoZoZo wrote: »

Does that not leave the buyer in a very bad position, ie your are contractually committed to completing the sale by the completion date but the work may not yet be up to standard, once the contracts are signed the builder can do a half-arsed job and then just run down the clock ?

There is no real completion date for new builds. All dates given to you will just be estimates (and usually wrong).

There can be no running down the clock, since a clock doesn't exist.

ZoZoZo

Okay, so it sounds like the sequence is:
1. Make an offer
2. Go sale agreed and they send the Contract for Sale and Title Deed to my solicitor
Builder expects contracts signed *within a couple of weeks*. I am now legally obliged to buy the house.
3. Builder continues working and sends a completion notice when finished
4. I have someone do the snagging and the closing date gets pushed back until I am happy ?

My question then is, how specific is the contract for sale in terms of fixture and fittings and the finish ?
I'm in a bit of an unusual situation in that I made an offer *below* the asking on a new-build that has been hanging around for a while, after a bit of haggling via the EA we agreed a higher price, still below asking and they specified that one of the built-in units wouldn't be included. I'm just wondering if the builder might scrimp on some of the other fixtures/fittings to further reduce the gap between what he was expecting to get vs. what I have offered.
I have viewed an identical show-house and I have a brochure which gives general bullet-points of what is included. For example the brochure lists:
"Custom-designed integrated hand-made kitchens"
- I believe this includes all appliances (except washer/dryer) but really it is quite vague, will the Contract that I sign for the house be more specific as to what exactly is included in the kitchen bathroom etc ?

Thanks,

Zozo

awec

The contract will probably say something like the materials used will be as described in the plans, and if they have to substitute any materials they will be of at least equal quality to the originals.

I don't think the contract will specifically itemise the fixtures, fittings or white goods included, but I can't remember.

Dolbhad

ZoZoZo wrote: »

Okay, so it sounds like the sequence is:
1. Make an offer
2. Go sale agreed and they send the Contract for Sale and Title Deed to my solicitor
Builder expects contracts signed *within a couple of weeks*. I am now legally obliged to buy the house.
3. Builder continues working and sends a completion notice when finished
4. I have someone do the snagging and the closing date gets pushed back until I am happy ?

My question then is, how specific is the contract for sale in terms of fixture and fittings and the finish ?
I'm in a bit of an unusual situation in that I made an offer *below* the asking on a new-build that has been hanging around for a while, after a bit of haggling via the EA we agreed a higher price, still below asking and they specified that one of the built-in units wouldn't be included. I'm just wondering if the builder might scrimp on some of the other fixtures/fittings to further reduce the gap between what he was expecting to get vs. what I have offered.
I have viewed an identical show-house and I have a brochure which gives general bullet-points of what is included. For example the brochure lists:
"Custom-designed integrated hand-made kitchens"
- I believe this includes all appliances (except washer/dryer) but really it is quite vague, will the Contract that I sign for the house be more specific as to what exactly is included in the kitchen bathroom etc ?

Thanks,

Zozo

I found specifiations not as detailed as you may expect of buying off plans. However depends on the builder it seems. White goods tend to be only provided in new builds around Dublin area so contracts or specs should say what’s it in. If not you’ll have to tell your solicitor to get them added in. You also get PC sums ie kitchen could be worth 4K and tiling for bathrooms 1k. If you decide not to use the builders tiler or kitchen, that would be knocked off the sale price and you do it yourself after the sale closes so maybe that’s where the price difference will be.

But you should keep note of everything you’ve been told off auctioneer and pass on to your solicitor.

Beware I have been told off friends when white goods are to be included it was a condition that contracts were signed within 21 days which is tight as your loan offer needs to have been issued by the bank to sign contracts.

Gumbo

ZoZoZo wrote: »

Okay, so it sounds like the sequence is:
1. Make an offer
2. Go sale agreed and they send the Contract for Sale and Title Deed to my solicitor
Builder expects contracts signed *within a couple of weeks*. I am now legally obliged to buy the house.
3. Builder continues working and sends a completion notice when finished
4. I have someone do the snagging and the closing date gets pushed back until I am happy ?

My question then is, how specific is the contract for sale in terms of fixture and fittings and the finish ?
I'm in a bit of an unusual situation in that I made an offer *below* the asking on a new-build that has been hanging around for a while, after a bit of haggling via the EA we agreed a higher price, still below asking and they specified that one of the built-in units wouldn't be included. I'm just wondering if the builder might scrimp on some of the other fixtures/fittings to further reduce the gap between what he was expecting to get vs. what I have offered.
I have viewed an identical show-house and I have a brochure which gives general bullet-points of what is included. For example the brochure lists:
"Custom-designed integrated hand-made kitchens"
- I believe this includes all appliances (except washer/dryer) but really it is quite vague, will the Contract that I sign for the house be more specific as to what exactly is included in the kitchen bathroom etc ?

Thanks,

Zozo

1. Pay asking price. No such thing as making offers on new builds.

You are buying what you see in the show house and/or what is listed in the estate agents sales brochure.

tradesman

If you agreed the price with the estate agent you need to have them clarify on paper / email exactly what they have agreed to sell to you. If I were you I would email them first detailing all the items you agreed with them on the day. Let them come back to you if there is any discrepancy.

Remember that the agent and the builder are not your friends!! They will be all smiling when doing the deal with you but things can change as the process continues. ALWAYS, GET EVERYTHING IN WRITING. That way you have a trail to follow.

Good luck with the purchase!

How long before the house will be ready for you?

ZoZoZo

kceire wrote: »

1. Pay asking price. No such thing as making offers on new builds.

You are buying what you see in the show house and/or what is listed in the estate agents sales brochure.

> No such thing as making offers on new builds.


Well this is clearly nonsense as I have made an offer and it has been accepted. it may be unusual and indeed it may be a sign of the currently softening market, nevertheless it is clearly possible.

ZoZoZo

tradesman wrote: »

If you agreed the price with the estate agent you need to have them clarify on paper / email exactly what they have agreed to sell to you. If I were you I would email them first detailing all the items you agreed with them on the day. Let them come back to you if there is any discrepancy.

Remember that the agent and the builder are not your friends!! They will be all smiling when doing the deal with you but things can change as the process continues. ALWAYS, GET EVERYTHING IN WRITING. That way you have a trail to follow.

Good luck with the purchase!

How long before the house will be ready for you?

> GET EVERYTHING IN WRITING


Well that's my point really, they said everything as per the borchure/showhouse except one named item. I could ask them to write out a list but it would make a lot more sense if this was just part of the contract by default, and maybe it is ? It just seems very odd that it wouldn't be, how would any solicitor allow you to sign a contract to buy something if it wasn't clear exactly what you were buying ?

Anyway, I'll see what the solicitor says.

They say the house should ready by July.

tradesman

ZoZoZo wrote: »

> GET EVERYTHING IN WRITING


Well that's my point really, they said everything as per the borchure/showhouse except one named item. I could ask them to write out a list but it would make a lot more sense if this was just part of the contract by default, and maybe it is ? It just seems very odd that it wouldn't be, how would any solicitor allow you to sign a contract to buy something if it wasn't clear exactly what you were buying ?

Anyway, I'll see what the solicitor says.

They say the house should ready by July.

I have snagged houses that the shower doors were not fitted & were not going to be fitted even though they were in the show house & the brochures! The builders say if you don't like it I have other buyers waiting for a cancellation. A buyer gets attached to the property after booking the house & along with time constraints & prices going up they relent & put their own doors in. How builders can get away with not putting a shower door on a shower enclosure just doesn't make sense.

3DataModem

Make sure your contract includes everything that you want included in the new build. Brochures, photos, etc will not help at all in any enforcement action you try and take. I just bought a new build and my solicitor was very clear on this... if it is not in contract, you have no comeback.

neeraj_jain

Hey all,

I am in a similar situation, however in my case the property is ready to move in.

1. We have paid the booking amount and got sale agreed.
2. The vendor has sent the contracts to my solicitor and given us 21 days to sign the contract.
3. We have received AIP from the bank but they are currently processing our application for an official mortgage offer.

Now our solicitor insists that contracts should not be signed unless we get an official mortgage offer from the bank.

Can someone please advise if we have wait until we get official mortgage offer before signing the contracts or can we still sign before the 21days expire?

I am worried if the vendor may cancel our sale agreed treaty if we don't sign the contract within the provided time frame and open it for others who are in waiting list.

Also, from the above posts it seems snagging can be allowed only after we sign the contracts and pay the 10% amount?

In this case where the property is ready to move in, generally how much time it should take for the vendor to ask for the remaining 90% of the contract after we sign the contracts?

Any inputs appreciated.

Thanks.

Dav010

https://www.boards.ie/discussion/comment/119610309#Comment_119610309

Are you in a position to complete the purchase without a mortgage? When you sign that contract, you have to pay a deposit, usually around 10%, but unlike a booking deposit, that 10% is not refundable after the contract is signed, if you don’t complete, you will likely lose it.

Judging by your solicitors reluctance to let you sign, there is no “subject to drawdown”.

neeraj_jain

https://www.boards.ie/discussion/comment/119610679#Comment_119610679

We had applied for mortgage, but it was taking too long to get loan offer. Though we eventually got couple of weeks extension from the vendor to sign the contracts. Everything is in place now, we are waiting to hear back from vendor on the signed contracts.

awec

Any solicitor that allowed a client to sign a contract without having mortgage approval in place would be very incompetent IMO.

Usually you sign the mortgage offer and the contract at the same time in your solicitors office.

The vendor will get the other 90% once you are happy that your snag list has been addressed, and you instruct your solicitor to begin the drawdown proceedings.

3DataModem

Forget about the estate agent's promises. Your contract is all that is enforceable when the time comes.

And yes, you assume a risk, so can ask for details on finish to be included in the contract.