Off-plan purchases represent some of the best opportunities available in the London new development market. The ability to select a preferred unit, floor, and aspect before the building is complete, often at a price that reflects pre-completion risk, is a significant advantage for buyers who understand how the process works.

This guide covers the key stages, risks, and practical considerations for buyers purchasing off-plan in Greater London.

• Off-plan buyers typically have access to the full unit mix before public launch, including the most sought-after floor plans and aspects
• Exchange of contracts typically occurs within 28 days of reservation, with the balance payable only on legal completion
• The construction period between exchange and completion can range from 12 to 36 months depending on the scheme

Reservation and exchange

The off-plan purchase process begins with a reservation. On reserving a unit, the buyer pays a reservation fee, typically between £2,000 and £5,000, which is deducted from the purchase price and holds the unit while solicitors are instructed and the contract pack is reviewed. The reservation agreement is not legally binding, and either party may withdraw at this stage.

Exchange of contracts follows, usually within 21 to 28 days of reservation. At exchange, the buyer pays a deposit of typically 10% of the purchase price, which is held by the developer's solicitor in a designated client account until legal completion. The deposit is at risk if the buyer fails to complete at legal completion. It is therefore essential that buyers have their financing confirmed before exchanging contracts.

• Reservation fee is typically non-refundable if the buyer withdraws after the agreed reservation period
• Exchange deposit of 10% is held in a designated client account and is protected in the event of developer insolvency under certain structures
• Legal completion, and therefore the balance of the purchase price, is payable only when the building receives its practical completion certificate

The construction period

The period between exchange and legal completion can span 12 to 36 months, depending on the stage of construction at the time of the sale and the complexity of the scheme. During this period, buyers should expect regular progress updates from the developer's sales team. Harroway provides a structured communication programme for all buyers in schemes we are managing, with milestone updates at foundation, structural frame, and practical completion stages.

• Buyers should budget for potential changes in mortgage rate between exchange and completion, as mortgage offers typically expire after six months
• Changes to the specification between exchange and completion should be addressed through the contract's specification warranty clause
• A pre-completion inspection, accompanied by Harroway's sales team, is arranged for all buyers before legal completion

"The buyers who have the smoothest off-plan experience are those who understand the timeline before they exchange. The process is straightforward when you know what to expect at each stage."