PLC New Homes: why I would never buy one
Apples – sometimes you bite into one and what lies beneath the pristine surface, is nothing but a floury rotten core. You could say this is like buying a new build home from a PLC developer (ie one who is listed on the stock exchange), where their sprawling mass-volume schemes continue to plague Yorkshire. But what exactly is my issue with them and why would I never buy one?
Let’s start with one of my biggest issues – build quality. There are consistent reports in the media about sub-standard practices and corners being cut – all with the sole aim of maximising profit margins. PLC developers are not charities and are there to support their shareholders and to maintain stock position. PLC developers usually want 25-30% profit margin on each unit they sell, but they still need to install the glamorous kitchens and bathrooms as buyers can see and touch these. Therefore areas can be overlooked on items one can’t see behind the scenes such as cavity wall insulation, fire barriers, plumbing, wiring, roofing etc to get the profit. It’s not exactly ethical.
Many buyers then say, don’t worry we have all the guarantees and warranties, so we’re covered if something goes wrong. Well I would turn this around and ask – have you actually tried to make a claim on said warranty? Good luck!
It’s all about secondary and tertiary locations – after all, the only land available for the size of schemes that PLC developers want, lie on the outer fringes of already existing conurbations. So where is the upside when property is all about location? Lack of supporting infrastructure, traffic problems, shortage of school places and GP surgeries – the list goes on.
In these uninspiring, soulless Stepford streets, one can rarely add value as the developer has already maxed out the angles so their profit is amplified. In addition, buyers seem to sleepwalk into paying an excessively high price from the outset due to the glossy marketing and commission hungry sales staff. Therefore new owners are solely relying on the market to increase their home’s value during their time in ownership. So what happens if the market doesn’t go up and/or you fall into negative equity?
With the continued decline of the High Street, isn’t it about time we reinvigorated these areas. I firmly believe there is no need to build on open green space. Instead the Government needs to incentivise PLC developers to refurbish what we have and to help bring communities back together.
In conclusion, I did a quick straw poll of 20 estate agents and solicitors that I work alongside. Not a single one owned a PLC new home. And that’s all you need to know.