New Build Reservation — What to Expect and How to Protect Yourself

Reservation is the first formal step in purchasing a new build. You pay a reservation fee, sign a reservation agreement, and the developer agrees to hold the property for you for a set period while you instruct solicitors and arrange your mortgage.

What Is a Reservation Agreement?

A reservation agreement is NOT a legally binding contract to purchase. It reserves the property in your name for a fixed period (typically 28–42 days) during which the developer expects you to exchange contracts. If you do not exchange within that period, the developer can re-market the property.

The agreement will specify:

• The property (plot number, address)
• The agreed purchase price
• The specification included
• Any upgrades agreed
• The exchange deadline
• The reservation fee and conditions for its return

The Reservation Fee

Typically £500–£2,000 (sometimes higher on premium developments). It is usually **non-refundable** — meaning if you change your mind or cannot proceed for any reason, you lose this money. Exceptions:

• Developer fails to proceed or the property cannot be built as agreed
• Developer materially changes the specification without your consent
• Mortgage declined (check the agreement — some specifically include this, many don't)

Read the refund conditions in the agreement carefully before paying.

Spec Locks and Upgrades

At reservation, you will likely be offered upgrades to the standard specification: kitchen upgrades, flooring changes, tile selections, electrical additions. Key points:

• Get all agreed upgrades recorded in writing — the reservation agreement or a separate spec sheet
• Developer upgrade pricing carries a significant markup (typically 30–50% above what the same work would cost independently)
• Some upgrades (kitchen choice, bathroom tiles) close weeks after reservation — confirm the decision deadline
• Structural changes (removing a wall, adding a window) are generally not possible post-frame-stage

What Happens If You Can't Exchange in Time

If you reach the exchange deadline without being ready — because your mortgage is delayed or your solicitor hasn't finished the legal review — you are at the developer's discretion. They can:

• Extend the reservation period (common if the cause is outside your control)
• Re-market the property (and you lose the reservation fee)

To avoid this, instruct your solicitor on the day you reserve and submit your full mortgage application within 48 hours. Flag to your broker immediately that there is a firm exchange deadline.

Independent Legal Advice

The developer's sales team will often suggest their preferred solicitor. You are not obliged to use them. Use an independent solicitor who specialises in new build conveyancing — the contract review requires specific expertise. Your solicitor should challenge any terms that are unreasonable before you're committed.

Cooling Off Period

Unlike consumer purchases, new build reservations in England and Wales do not carry a statutory cooling off period. Once you've paid the reservation fee and signed the agreement, you are committed to that timeline (though not yet legally bound to complete the purchase). Take time to review before signing — there is no obligation to sign on the same day you visit the development.