Awareness Campaigns
The Berkeley Homes Collective initiated its Public Awareness Campaigns on 1st August 2009 at Berkeley Homes’ Royal Arsenal development in London. They are run regularly at marketing suites and new Berkeley developments.
Buyer Awareness Campaign @ Royal Arsenal. Photograph by: Teri Pengilley
The aim of the campaigns are to educate potential off-plan homebuyers about the risks of buying a new build property and to inform potential customers how Berkeley Homes are currently mis-managing the current crisis affecting their buyers.
Buyer Awareness Campaign Flyer (front)
Click here to read the reverse of the flyer
The key points that any off-plan buyer must know are:
- There is no consumer protection for new build properties.
- Your reservation deposit paid on the day you reserve (typically £1000 – £2000) is not refundable, even if you subsequently find the property is not worth what the sales people claim it is at point of reservation.
- Your 10% deposit is not the end of your liability. Unlike other transactions where a deposit is paid, and as most people reasonably appreciate that if they don’t go through with the purchase they will lose their deposit, in the case of a new build property if you do not or cannot complete the developer will sue you for marketing costs, legal costs, interest and the difference in price between your contract price and whatever they eventually sell the property for (even if they auction it at a distressed sale price).
- Many lenders will not offer a mortgage at all on new build properties at the current time. Most will only now lend 75% LTV.
- Some lenders are now refusing to lend on the Royal Arsenal development due to “over exposure”. This has resulted in mortgage offers being withdrawn for some buyers leaving them high and dry and at the mercy of Berkeley Homes’ aggressive tactics.
- Mortgage valuations at Caspian Wharf and Royal Arsenal are currently coming in at -30% and -40% of the sales list price respectively (at the time of writing). The sales people may tell you they have their own valuations, but you won’t get to see them and your bank won’t accept them.
- Berkeley Homes will tell you they can provide your bank with comparables to help push your mortgage through. This won’t work as the Royal Institute of Chartered Surveryons (RICS) has wised up to this practice and now instructs surveyors to ignore comparables from within the same development.