First-time buyer of Wicklow new build left ‘fuming’ at last-minute €15,000 price hike

In a text book case of buyer beware, the purchaser, who wishes to remain anonymous, was sent an email from the agent at the end of May this year, ahead of the launch in June of two-bed terraced houses at Sea Gardens in Bray.

The homeowner said initially when she enquired, there were two homes priced at €500,000, but they were no longer available, so she registered her interest for the other properties that were due to come on stream in the summer.

Over the next two months, the purchaser said there were weekly calls with the agent at Savills, who she said carefully and efficiently went through plans and promised she would be in touch when the homes were to be released.

Delighted to be closer to that dream home, having "saved for seven years and bidded for houses for two years", a new build, albeit on a tight budget, was at least more of a certainty than having to negotiate the second-hand property market. Or so she thought.

Prices jump €15,000 with one day's notice She was "under no illusion" that the house was going to increase in price and was told by the agent that a guide price would be "between €525,000 to €540,000". She was then informed that "it's looking like it's going to be €535,000".

"And I said, €535,000? Happy days, let's go for it," she said. "Then the agent rang me when the launch email came out. So, the launch email said two-beds, terraced houses, from €535,000.

"I booked in my appointment to buy my house at €535,000," she explained. "Then the day before, so the Thursday at probably 3pm, the agent phoned me and she said, 'I'm so sorry, the developers have decided to increase the price of all of the two-bed houses by €15,000. So, if you are still keen to progress, you will be buying your house for €550,000'."

She was given until close of business that day to decide whether or not she would proceed at this price.

"I actually flagged this with my solicitor because I was so annoyed about it. But the email says terrace houses from €535,000."

She added: "I have been bidding for houses for two years. I bid on every single house. And, honestly, €535,000 was already maxing out. I had to ring my dad. I was hysterical. I was like, what do I do? Do I pull out? And he just said: 'You go in tomorrow, and you sign for that house, and we will find 15 grand from somewhere.'"

The homeowner managed to borrow the money to make up the shortfall and is just weeks away from moving in, just in time for Christmas. But the dream isn't complete just yet.

Hidden costs pile up: 'I can't afford to floor it "I realised that I had to buy floors," she explained. "And I was like, 'I could have really done with that 15 grand'. I'm absolutely screwed now, to be honest. I don't actually know what I'm going to do about the floors. I haven't even snagged yet. They're saying it's going to be before Christmas. But I got a quote for nine grand to do my floors and I laughed."

Asked why, if she had been informed of the price hike in June, she was only making the information known publicly now, she said: "I just got a spur of rage, that's why. I had to borrow so that I could sign for the house, and I have spent the last six months paying back the 15 grand.

"So now, savings that I thought I would have to furnish a house are gone. So I'm now moving into a house and I can't afford to floor it. I won't have a couch for years. I'll have a couch this time next year."

While the purchaser said she "couldn't be happier", and was full of praise for the way the agent handled her situation, she added she is "fuming".

"I'd been on that journey for two months. I had spoken to my broker. I'd got everything sorted for €535,000. I know how fortunate I am to be in the position that I'm in. But it is just horrible."

Developer responds: 'No prices were ever agreed at €535,000' When contacted, a spokesperson for the developers, Ballymore, said no prices were ever agreed at €535,000 and the prices wouldn't have been set until the actual day of the launch.

"So when the buyer was there on the day, all prices were at €550,000. We wouldn't actually set our prices until the day of the launch, any single launch we ever do. So they would have been €550,000 and then they would have been given the option to buy or not buy."

Ballymore explained that when it comes to pricing properties that are about to be released for sale, "things change a week before, a month before, that would just be quite common".

"Savills would have told everybody the price of €550,000 on the morning of the launch. So there was nothing agreed at €535,000."

While, the purchaser did receive an email at the end of May to indicate that two-bed terraces were going to be made available from €535,000 and had pinned her hopes on that price, those prices were not binding and served as a guide only.

Industry insight: 'Buyer beware' in new developments Property consultant Derek Byrne, from Delgany, while not commenting specifically on Sea Gardens, said more generally it is a case of buyer beware when it comes to buying new homes in large developments, and remarked that this is something he sees all the time.

Developers would normally have an enticing headline price but with just a small number of those homes available, usually the least attractive units. Regardless of what guide prices are mentioned by agents, "everything is still subject to contracts" and the prices are generally not confirmed until the day of signing, when they can suddenly increase.

"Everything's subject to contracts, so even if they took a booking deposit, they could turn around, put up the price, give you back the booking deposit, and sell it to somebody else. It's that bad," he said. "New homes are a bit of a grey area because it's not buyer and the seller. It's more of a commercial transaction where it's an agent selling multiple units for a company."

Mr Byrne also pointed out that developers can be impacted by delays, not of their own making, which can impact on prices.

"I think the problem is, in fairness to the developers, you go in, and you're told we're going to launch in March. Then getting infrastructure, like water, slows you down by six months. And then all of a sudden, the market's moved. It's gone up 6pc, so there is a very good reason why a developer has to put up the price.

"As some developers deserve a bashing, there's a lot of them that don't. They're getting bashed for the wrong reasons. And in a rising market, the developer's not going to leave 20 or 30 grand on the table. Because they are also paying interest during that six-month period. So most developers are working on 12pc profit. It used to be 20pc. A year delay can actually take all their money."

Mr Byrne said he sells "a lot of new homes" and the caveat emptor, buyer beware principle is best borne in mind for new buyers.

"What I always do is register your interest. When you register your interest, you might say, there's going to be a range of values, and it's going to be in and around this. But there won't be a commitment, though. But you give the buyer an idea and a range."

By way of consoling the buyer at Sea Gardens, Mr Byrne points out that the house could already be worth a lot more by the time the other phases come on the market. In fact, two-beds in the same development are currently listed with a guide price of €575,000.

"Getting in early is no bad thing," he said, and cites the example of developments in Greystones in recent years, where houses at the early phases were going for €430,000, "and people thought they were expensive in phase one –by the time they were finished, a three-bed semi was going for €600,000."