Converting a Pub to a House - What to do first?

SammyS1987

I can't offer any advice but I just wanted to say good luck. I'm going to be keeping an eye on this interesting thread and I hope you get the finance.

eddddy

There are a few companies that specialise in auction finance. I've never used them, but you can find them with Google. I believe that they will lend funds while you refurbish, get planning consents, get a mortgage etc etc. But I suspect they will charge you an arm and a leg in arrangement fees and interest.

Don't forget that if you buy at auction, the property is 'sold as seen' - for example, it may have dry rot, subsidence... there may be plans to build a motorway through the back garden... it may have legal issues... Once you've bought it at auction, you will have no comeback on any of these.

If you're not confident about your own ability to assess the state of the property and the legal stuff, you should instruct a surveyor and solicitor before the auction. But obviously, you will need to pay their fees, even if you don't buy.

TBH, if it's being sold at auction, there is probably something wrong with it somewhere. Otherwise, why didn't the current owners apply for planning permission for conversion, and sell it through a normal estate agent? Even if it's a repossession, the bank would normally try to sell it though an estate agent first. (Also, it's been through 3 auctions and none of the 'professionals' wanted to buy it. Do they know something that you don't?)

Some 'professional developers' might take a risk in these circumstances... Buy it at auction, then apply for planning permission, apply for a mortgage, get detailed costings for the conversion - and if it doesn't work out, sell it again in the next auction.

If it works out, they might make a good profit. But if they end-up having to re-sell at auction, they could be many thousands down on the deal. But if you like taking big risks...! (But I certainly wouldn't recommend it for an FTB!!!)

Doozergirl

eddddy wrote: »

TBH, if it's being sold at auction, there is probably something wrong with it somewhere. Otherwise, why didn't the current owners apply for planning permission for conversion, and sell it through a normal estate agent? Even if it's a repossession, the bank would normally try to sell it though an estate agent first. (Also, it's been through 3 auctions and none of the 'professionals' wanted to buy it. Do they know something that you don't?)

Agree with what you say but what is clearly wrong with it, and it's reason for being at auction is that it's commercial property with the added bonus of being a non-viable business. Even if it had PP for residential, it would go to auction because you will get different types of speculators. It wouldn't be sold through an EA as it isn't mortgageable as a home until it is actually a home.

Bear Building Regulations in mind also, OP. It's likely that the whole building would need upgrading to meet current regulations for either a new dwelling or a conversion, which will be higher than what currently exists. it may not be a case of ripping out the bar and turning it cosmetically into a home - it will probably require new upgraded windows, insulation, heating, electrics etc and works that you may not be expecting. You need to have a chat with Building Control or an Architect as well.

With two weeks, I'd be frightened of not being able to pull this off with any degree of certainty of what this is going to cost you. If it's not sold several times already, there's a chance it won't sell again and you might have a chance to buy it with a bit less pressure on you.

eddddy

Doozergirl wrote: »

Even if it had PP for residential, it would go to auction because you will get different types of speculators. It wouldn't be sold through an EA as it isn't mortgageable as a home until it is actually a home.

Hi Doozergirl

I'm not sure that this is really accurate. Most commercial property is sold through estate agents, whether or not it has planning permission for conversion to residential, and whether or not it is suitable for a residential mortgage. Here are a some random examples:

http://www.zoopla.co.uk/for-sale/details/14645555
http://www.zoopla.co.uk/for-sale/details/14630997
http://www.zoopla.co.uk/for-sale/details/2872682

In my experience, properties tend to go to auction because they are 'problem properties', or occasionally because the seller is desperate to get the money quickly.

Eddddy

neverdespairgirl

lostInSpace wrote: »

Yeah, just spoke to my bank - and they wont touch it. Damn

It feels like this is going to be a massive opportunity lost because i cannot get the mortgage. The size, land etc - it's worth so much more than the £150,000. I've got £45,000 deposit too!

If it's any consolation, if it were possible to get a mainstream mortgage, it would almost certainly be a lot more expensive to buy.