Mortgages on ex-local authority flats

jaypod

[Hello MSE-ers - my first post!]

I'm a potential first-time buyer in London and seriously considering ex-local authority properties for (a) cost-location ratio and (b) larger room sizes. I understand these can be difficult to get a mortgage on, however, so I have two questions:

1. How do I identify which ex-LA properties are un-mortgageable and which aren't?

• The problem as I understand it is something about "single-wall" construction and being made of the wrong type of concrete construction. What's the exact name of this?
• How do I find out which buildings have which type of construction? Will estate agents always know / be honest? Can I find out through the Land Registry or similar?
• Would I be right in thinking that the brick inter-war ex-council blocks (4 storeys, with walkways) are more likely to be alright? Are all high-rises un-lendable?

2. Does the difficulty of getting a mortgage on this kind of property mean I will need to go to a mortgage broker than to the bank directly?

If not, which banks tend to be keener on lending on these types of properties? Which ones don't at all?

My financial circumstances: single professional, 20% deposit, looking to borrow 4x salary, credit rating was totally clear last time I checked. Aka personally speaking I should be mortgage-worthy - question is just whether my choice in property is...


Thanks in advance,
J

Senior_Paper_Monitor

An excellent question.

As brokers we have access via at least a couple of lenders (who are also the ones we find most receptive to such properties) to their surveyor panels who will check their records and give us a pre-application 'probable/not a chance opinion'.

I am not sure whether these are available direct - I suspect not, but really don't know.

If its of any interest - most of the properties we have taken forward on this basis have been rejected. They are - as a general statement - not easy to place.

cattie

I know my nephew was refused a mortgage on a flat in Islington on the basis that the block was more than 4 storeys high.

If you are seriously considering ex council, you need to be aware of the strong possibility of high service charges and huge bills as your contribution to any major works, sometimes such contributions can be in the region of £10k per flat, depending on the type of work carried out. Even in a small block, something like painting the external common parts can end up costing you between £2-£3k.

jaypod

Thanks @SeniorPaperMonitor.

It is frustrating - so many flats in Hackney, Whitechapel, Peckham (London) are ex-council, so it really limits my choice at this end of the market (around £180k). The ones that aren't ex-council are then flats above shops, which I gather can have mortgage complications too.

@Cattie
Good point on the works charges. I know this is a risk and wouldn't want to buy unless I could get some kind of confirmation or clearance (via solicitor?) that there wasn't anything in the pipeline. All the London ex-local authority blocks have had their windows upgraded now, it seems - but yes, who knows what could happen?


So I guess whatever I think of the flats, the combination of mortgage hell + difficulty selling is probably a pretty good reason not to consider even looking at them. FTB-ing is hard enough without these extra complications, right?

melysion

I'm currently in the process of buying a ex-council flat. Its a maisonette, and the building is only 4 stories high.

My mortgage broker suggested Northern Rock, Santander or Halifax as lenders more likely to accept ex council properties. Hope that helps a bit anyway

jaypod

@melysion
Thanks, that's useful - and the 4-storey height limit is something else I'm learning about too.
Not sure Santander will be lending to anyone any time soon now, but good to know about Northern Rock and Halifax. From searching this forum it also seems Woolwich may be more open to these types of properties.