What Is a Reservation Fee on a New-Build Home?
When you buy a new-build property, one of the first steps is paying a reservation fee. This fee shows the developer that you’re serious about purchasing and in return they take the property off the market for an agreed period.
Reservation fees vary, but they typically range from £500 to £2,000.
This amount is usually deducted from the purchase price when the sale completes.
Once paid, the developer will:
- Hold the property for you for a set period.
- Freeze the price, so you’re protected from any price increases.
- Provide a reservation agreement, which outlines key details, including specification, timeframe, and what’s expected from both sides.
This window gives you time to arrange your mortgage, appoint a solicitor, and work through the initial legal checks.
Read you reservation agreement carefully so you understand the terms and conditions.
There is a 14-calendar-day cooling-off period, during which you can cancel the Reservation Agreement and receive a refund of the full reservation fee. Your reservation fee will still be refunded if you change your mind outside of the cooling-off period, minus any reasonable costs, which the developer will outline in advance.
A reservation fee is a small but important step that secures your chosen home and locks in your price, giving you peace of mind as you progress with your purchase.
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