November 13, 2018

Peter Buckingham highlights barriers to lending for unusual properties

This month, Peter Buckingham, Head of Sales at Andrew Granger & Co’s Market Harborough office contributes to an article on industry website about the difficulties that can occur when trying to secure finance for unusual properties.

Departing from tradition

The popularity of property-based TV shows like Grand Designs and Property Ladder over the last two decades have changed many people’s idea of what a home can be. Conversions of properties such as windmills, water towers and warehouses may not be commonplace, but people are far more likely to consider them than they were 20 years ago.

TV shows and blogs have also inspired people to experiment with unusual construction techniques using materials like timber frames, concrete and glass.

Creative block

This kind of innovative thinking can be a great way to make use of modern and sometimes more environmentally-friendly techniques and also to prevent the decline of buildings that otherwise might slide into dereliction. However, not everyone is convinced that this kind of building project is a good bet.

In the piece, Peter Buckingham addresses the fact that the high street banks are not always on board with this new kind of approach to house renovation and may regard these kind of projects as too much of a risk to provide a mortgage for.

“Agents selling these types of properties stand a better chance of success if they are aware of the issues and are able to give some guidance on alternative sources of finance,” says Peter.

Peter also goes on to comment on instances where he has heard of a buyer being found by other agents, but the failure to pick up on the fact that it won’t be possible to arrange a mortgage means that the entire process is a waste of time for both the potential buyer and seller.

Issues to watch out for

Peter then goes on to point out potential issues that could affect getting finance that all agents should be aware of when undertaking a valuation:

  • Flying freehold. This term describes a freehold which is situated over or underneath a freehold owned by someone else. This could be when a balcony hangs over a neighbouring property or when a room in a house is located over a shared passage in a semi-detached property.
  • A property that is need of extensive renovation.
  • A property with subsidence issues.

Peter cites an example of a recent sale handled by Andrew Granger & Co of a derelict house which had been affected by tree root damage. To avoid the issue of not being able to arrange a mortgage for this property, a cash buyer was found for the property.

Selling an unusual property in Leicestershire

To read the article in full click here. If you are considering selling an unusual property, you can contact us for advice on the following numbers:

  • Leicester 0116 242 9922
  • Loughborough 01509 235534
  • Market Harborough 01858 431315