Property developers offering free gifts and cash incentives to first-time buyers are "insulting" their intelligence, it has been claimed.
First-time buyers should ignore developers who offer them money or gifts to buy properties at certain prices, according to the chief executive of mortgage advice firm Firstrung.
Paul Holmes went as far as to say that these incentives were "insulting... to the intelligence of a first-time buyer". He said that a person interested in purchasing a home would always want to buy the property for a lower price, rather than at the same price but with free gifts.
"My advice to first-time buyers is ignore all that noise, ignore all the offers," he said. "If you can't get a good discount off the headline price walk away, because there will be another, more desperate developer down the line who will knock a sensible amount off the cash price of the property."
Mr Holmes explained that the reason developers offer the incentives rather than bringing down prices is because they don't want their properties to reflect their "correct price". If the developer owes their lenders money but can say they have a property worth a certain amount, then it protects them.
However, if they suddenly sell that property for a lot less it creates a "funding gap", which will mean "the banks will lose confidence in them, their investors, the City - they are in trouble".
