Is my new home refurb or new build?

Purdy71

This sounds like a stupid question, but even my potential mortgage lender isn't sure!

I want to buy a house which is part of a development of new build and refurb properties. The property I'm interested in is two houses that have been knocked into one and then completely renovated inside.

I would say this is a refurb, but apparently it may be considered new build, unless I can argue otherwise. Any thoughts on why this might be, or how I can argue the case?

Dave_Ham

Depending upon the lender it will be marked as new build, or newly converted.

Both of which are highly likely to mean it will be capped at new build loan to value thresholds..

Purdy71

Thanks Dave. So even though the structure of the property is pre-existing, the property is considered newbuild. Do you know why this is? It's the difference between affordability or not for me - if they ask for another 5% deposit I won't be able to go for it.

Own_My_Own

I now nothing about this, but is the address of the house pre-existing ?
If so, surely you have that on your side.

Dave_Ham

I am afraid this will almost certainly be treated with new build loan to values.

If you are going to incur any cost for valuation etc., please ensure the broker/advisor has absolutely checked the detail of the property specifics.

Good luck

kingstreet

If you are the first occupier of the property in its present condition, it is treated as a newbuild by most lenders, if not all, and the lower maximum LTV will apply.

Halifax criteria, for example;-

An initial occupancy/new build property is classed as any property being occupied and/or sold for the first time on the open market in its current state. These will fall into one of the following categories:

Newly built property.
Refurbished property i.e. refurbishment of an existing residential property, typically a re-furbished property will be considered as initial occupancy where the vendor is a builder/developer and the property has been vacated to allow for the refurbishment to be undertaken.
Newly converted property i.e. conversion of an existing non residential property, e.g. an existing mill converted into flats.

Purdy71

Thanks for the advice guys. Weight of opinion means it's not looking very good, is it? I'll do my best to argue the case but at least I have a realistic outlook now.

borkid

Purdy71 wrote: »

This sounds like a stupid question, but even my potential mortgage lender isn't sure!

I want to buy a house which is part of a development of new build and refurb properties. The property I'm interested in is two houses that have been knocked into one and then completely renovated inside.

I would say this is a refurb, but apparently it may be considered new build, unless I can argue otherwise. Any thoughts on why this might be, or how I can argue the case?

When we bought a barn conversion 10 years ago the BS initially considered it as of the age of the conversion for insurance purposes but the surveyor refused to do a homebuyers survey and would only consider a full structural survey because of the original age of the barn. Later the BS would only give us quotes for insurance for the original age ( 1850). I suggest you talk to the surveyor and see what he/she says. If he/she agrees its a refurb he/she should be able to give you some pointers of how to argue your case to your lender.

Purdy71

Good call Borkid. Thanks very much.

kingstreet

What LTV do you need?

Purdy71

90% - it's a shared ownership property so it is possible, but only if it's a refurb. There is another lender who would possibly give me the mortgage at that LTV but obviously the rate is higher. I'm also a FTB so this is making my head spin a bit!