Buying a half finished house..

adam197

Hi my wife and I are looking to buy another house. We've found a house that is "half" finished. Its fully built however the insides are pretty bare. e.g. no kitchen, stairs or bathroom. The house does have radiators, windows etc.

The house in question is up for 150k. We have around 25k savings and when we sell our house we should have around another 35k (we're both below 30 so haven't paid much back on our current house hence the low return value). Would we be able to finance this house with a mortgage? We would want to use 25/35k for the deposit and 25k for finishing the house..

Any tips would be great as previously when we looked at a house we where told it wasn't mortgageable due to having no kitchen/bathroom.. Is there a way to get around this or anyway to buy these houses without having cash only?

moneyistooshorttomention

I've certainly read about houses being unmortgageable without a kitchen. I would have thought the lack of a staircase would be an even bigger no-no to a mortgage company.

In theory, someone could manage without a kitchen, as long as there is a working sink of some description in the place. After all, many people are expected to live in bedsits without having a kitchen (well I was certainly back in the day years ago now), but not having a staircase to get upstairs:eek:

AlexMac

I have no direct experience (so hopefully more expert someone will chip in later) but try researching 'Self Build Mortgages' in case these help

Optimist

You would need to look at one of the specialist self build mortgage companies, Buildstore or its like

They would probably require a full survey on the work already done and the mortgage rate would be higher than normal.

adam197

OK Great thanks folks. I tried looking in to self build mortgages yesterday but most places where closed. I'll call around on Monday and update this thread if I get any more detail.

teddysmum

There was an item on tv, where a bungalow, being remodelled, burned down and the insurance company were being very difficult. The problem was, that, though the man doing the work sometimes camped out there, it was considered to be unoccupied, so should not have been covered.


This case was resolved, as the owners had been clear about their intentions, but someone made a mistake. However, it seems that companies are not eager to insure unoccupied properties , so as this property is not ready to live in, a mortgage company would be unwilling to take a risk.

ACG

You could get a bridging loan for say £100k, this would give you the money to complete on the purchase and install a kitchen/bathroom.

You could then potentially get a normal residential mortgage on the property.

A couple of issues you may come across:
- It may need a guarantee of some sort.
- Any bridging loan will need an "exit strategy" this means you will need to have another mortgage offer in place or potentially at the very least a decision in principle.