Reserving a new build property works differently to making an offer on an existing home. There’s a fee, a written agreement, and a tight deadline to exchange contracts. Understanding what’s involved, and being prepared for it, helps you avoid pressure decisions and keeps the process moving smoothly.
The reservation fee
When you decide to go ahead with a plot, the developer will ask you to pay a reservation fee. This is typically between £500 and £1,000, though some developers charge more for higher-value properties.
The fee takes the property off the market while your mortgage and legal work are completed. It’s usually deducted from the purchase price at completion, so you’re not paying it on top of everything else.
Whether the fee is refundable depends on the developer and the circumstances. Most reservation agreements include conditions under which you can withdraw and get your money back (for example, if your mortgage application is declined). But if you simply change your mind, you may lose the fee. It’s worth reading the reservation agreement carefully before you sign.
The reservation agreement
The developer will ask you to sign a reservation agreement. This sets out the key details: the plot number, purchase price, any incentives being offered, the reservation fee amount, and crucially, the deadline by which you need to exchange contracts.
This document isn’t the same as exchanging contracts. You’re not legally committed to buying the property at this point. But it does create an expectation that you’ll proceed, and losing the reservation fee if you pull out is a real cost.
Take the time to read it properly. If anything isn’t clear, ask. Your solicitor can also review it, though given the speed at which reservations happen, you may not have time to get legal advice before signing.
The 28-day exchange deadline
Most new build developers require you to exchange contracts within 28 days of reservation. Some allow longer, particularly if the property is still being built, but 28 days is the standard.
This is significantly tighter than a typical property purchase, where exchange can take two to three months. It means your mortgage application, valuation, and legal work all need to happen quickly.
The single most important thing you can do is be mortgage-ready before you reserve. If you’ve already spoken to a broker, had your finances assessed, and know which lender suits your situation, your advisor can submit the application immediately after reservation. That gives you the best chance of meeting the deadline without it becoming a scramble.
If you haven’t done any preparation and you reserve a plot on impulse, hitting 28 days is much harder. Delays with paperwork, lender processing times, or solicitor availability can eat through that window quickly.
What you should have in place before reserving
To give yourself the best chance of a smooth process, have these things sorted before you visit the show home:
You should have spoken to a mortgage broker and understand what you can afford. You need your deposit position clear: how much you have and where it’s coming from. If a family member is providing a gifted deposit, let your advisor know early. Have your documents ready: payslips, bank statements, ID, and proof of address. You should have also instructed a solicitor, or at least have one in mind.
Your advisor can recommend solicitors who are experienced with new builds. New build conveyancing (the legal process of transferring ownership) has its own quirks. Many new builds are sold as leasehold rather than freehold, meaning you own the property for a set number of years rather than outright, and there may be a management company responsible for communal areas. A solicitor who handles new builds regularly will be faster and more thorough than one who doesn’t.
What happens after you reserve
Once you’ve signed the reservation agreement and paid the fee, things move quickly. Your advisor submits your mortgage application, your solicitor begins the legal work, and the lender instructs a valuation.
Your advisor and solicitor will both be working towards that exchange deadline. You’ll need to respond promptly to any requests for information or documents. Delays on your side eat into the timeline just as much as delays from the lender.
The developer’s sales team will usually stay in touch during this period too. They want the sale to proceed, so they’re generally helpful with providing information your solicitor or lender needs.
For a detailed look at every stage from this point onwards, see our guide to the full new build mortgage process.
Can you negotiate after reserving?
The short answer is that the time for negotiation is before you reserve, not after. Once you’ve signed the reservation agreement, the price and incentives are typically fixed.
That said, if something material changes (for example, the build is significantly delayed, or a valuation comes back lower than the purchase price) there may be room for discussion. Your advisor can help you understand your options if this happens.
Developer incentives are worth discussing before you reserve. Cashback, stamp duty contributions, upgraded specifications, and deposit contributions are all common. But different incentives interact with your mortgage in different ways, so it’s worth having your advisor involved in that conversation. Our guide on developer incentives explains how they work and what to watch for.
If things don’t go to plan
Sometimes a mortgage application is declined, a valuation comes back low, or personal circumstances change. If you can’t proceed after reserving, the outcome depends on the reservation agreement terms and how far along you are.
Before exchange, you can usually withdraw, though you may lose your reservation fee. After exchange, the situation is more serious because you’re legally committed to the purchase. This is why it’s so important to have your finances properly assessed before you reserve, rather than hoping it’ll work out.
If you’re thinking about reserving a new build and want to make sure you’re in a strong position, speak to one of our advisors. We’ll make sure you know exactly where you stand before you commit.
