Getting a Mortgage on a New Build — What’s Different?

New build mortgages work on the same principles as resale mortgages but with three specific differences that catch buyers out: offer validity, developer incentives and leasehold assessment. Getting these wrong at the reservation stage is one of the most expensive mistakes in the Hampshire new build market — it can mean losing a £2,000–£5,000 reservation deposit because the mortgage fails after exchange.

1. Extended Offer Validity

Standard mortgage offers are valid for 6 months. New builds take 6–18 months to complete from reservation. If the build overruns the offer expiry, the lender must agree an extension or the application must be resubmitted from scratch — potentially at a different rate, with a new valuation, and with updated credit checks. We use new build specialist lenders who issue 12-month offers and commit to extension policy in writing before any reservation deposit is paid.

2. Developer Incentives

Cashback offers, upgraded specifications and deposit contributions from developers must be disclosed to the lender and affect the mortgage assessment. A £10,000 cashback or deposit contribution reduces the lender’s view of the effective purchase price. Some lenders deduct the incentive from the purchase price for LTV calculation purposes, reducing the available mortgage by the equivalent amount. We review the specific incentive package and confirm lender treatment before any reservation.

3. Leasehold Checks

New build flats are almost universally leasehold. Ground rent must not exceed 0.1% of the property value annually (lender requirement under most criteria). Service charges must be reasonable — high service charges affect affordability calculation and some lenders set absolute maximum service charge levels. Lease length must be a minimum of 85 years at the start of the mortgage. We confirm all three before any reservation deposit is paid on a Hampshire or Surrey new build flat.

Developer’s Recommended Broker

New build developers typically refer buyers to a panel broker who has a relationship with the developer. You are under no obligation to use this broker. Developer panel brokers are incentivised to get applications through quickly to protect the reservation timeline — they are not necessarily comparing the whole market for the best rate. An independent whole-of-market broker compares all lenders and is not constrained by the developer relationship. The rate difference between a developer’s panel broker and whole-of-market can be 0.2–0.5%, worth £2,000–£5,000 over a 5-year fix on a typical Hampshire new build mortgage.

Help to Buy on New Builds

The Help to Buy equity loan scheme closed to new applicants in March 2023. Shared ownership remains available on some new build developments. For buyers who used Help to Buy on a new build purchased in 2018–2021, the year 6 interest charge is now active or approaching. We handle HTB remortgage and equity loan redemption as a simultaneous process.

Hampshire and Surrey New Build Market 2025

Hampshire and Surrey have active new build delivery across multiple major sites. Hampshire: Manydown (Basingstoke), Picket Twenty (Andover), Bar End Park (Winchester) and multiple Hart District sites around Fleet and Hook. Surrey: Woking regeneration, Deepcut (completed), Camberley fringe and multiple Guildford green belt releases. Developer activity in both counties is sustained by the infrastructure investment in road and rail that makes Hampshire and Surrey locations viable for London commuters. New build pricing in these locations carries the standard 5–15% new build premium, which buyers should factor into their long-term equity growth expectations.

New Build and the Mortgage Guarantee Scheme

The mortgage guarantee scheme (5% deposits on properties to £600,000) is available on new build houses but not universally on new build flats. Most new build houses in Hampshire and Surrey are priced below £600,000 and are eligible. New build flats in prime Surrey locations (Guildford, Woking, Camberley) frequently exceed £400,000 for 2-bed units and may still fall within the cap for 1-bed units. We confirm scheme eligibility for the specific development before any reservation deposit is paid.

FAQ

Questions

Yes — on new build houses through the mortgage guarantee scheme and some specialist new build lenders. New build flats typically require 10–15% as fewer lenders offer 95% LTV on new build flats.

The lender must agree an extension or you reapply. We use lenders who issue 12-month offers and commit to extension policy before reservation. We submit extension requests proactively before expiry.

Subject to contract — new build contracts have specific terms on mortgage failure conditions. Review the contract with your solicitor before signing. Most allow withdrawal if mortgage is declined, but reservation deposits may be at risk.

New builds carry a “new build premium” of 5–15% over comparable resale properties at the time of purchase. They depreciate toward resale values over time. The premium is offset by warranty coverage, energy efficiency savings and no immediate maintenance costs.

Most new builds include a 10-year NHBC Buildmark warranty or equivalent, covering structural defects. Years 1–2 cover all defects reported to the developer. Years 3–10 cover structural defects only.

Yes — shared ownership is available on new builds from housing associations. Most new build shared ownership schemes in Hampshire are provided by Sovereign Housing, Vivid Homes and A2Dominion.

No. We are paid by the lender on completion.

Getting a Mortgage on a New Build What’s Different?