New build homebuyers are still able to exchange their homes during the coronavirus pandemic, with recent research revealing that 83% of the UK’s leading home developers are considering part-exchanging their units.
Ruban Selvanayagam, co-founder of Property Solvers who completed the research, said: “Each case would be judged on its individual merits. You may, for example, struggle to part exchange if you have a leasehold property with a relatively short-term remaining.
“Housebuilders may only engage in certain areas where they know that they’ll be able to sell quickly. Others will only offer part exchange when their projects have reached a certain stage (usually coming up to or post conclusion).
“If you find a developer willing to partake in part exchange, with the stamp duty holiday and historically low interest rates, swapping your existing home for a new build property can make a lot of sense.
“Not only would you effectively eliminate estate agency fees, but also avoid many of the hassles that come with an open market sale.
“The downsides, however, are that you’ll typically have to accept around 90% of your current property’s value.”
As a result, Selvanayagam concludes, rather than committing to part-exchanging, some developers are incentivising sellers to buy their units by offering them free estate agency services of their existing homes.
Selvanayagam added: “This would be on the basis that they would commit to buying the new build home and sellers may have to cover the fees themselves if they pull out.”
This post has originally been featured in Property Wire.