Getting a mortgage for a property due to be demolished in 10+ years

ligtning · 20 May 2014 at 2:11PM

Hi there,

I was wondering if anyone could provide any advice or suggestions for the following situation:

I am interested in a property which is part of a council regeneration scheme, and as such is due to be demolished in no sooner than ten years to make way for new housing (the council survey a few years back determined the refurbishing the properties was not cost-effective). If the redevelopment goes to plan, the council advise they will buy back homes at market rate. With my parents' help, we have a deposit of 60-70% so are wondering if any lenders would consider a short term loan of approximately 50-100k for (depending on the amount) 4-6 years. The property is leasehold with 85 years remaining.

Thanks for your help

Doug

Foxy-Stoat_3 · 20 May 2014 at 2:30PM

Speak to a good broker.

Very much doubt anyone on here will have experience trying to place a 30-40% LTV mortgage for 5 years with a big gifted deposit on a property that's due to be knocked down in less than 10 years.

ligtning · 20 May 2014 at 3:28PM

Thanks F-S. Yes, quite a specific situation!

getmore4less · 20 May 2014 at 4:04PM

I don't expect the market rate on houses that no one wanted to buy for the last few year is going to be that good, a few forced sellers and the "market" rate based on recent sales could look bad

kingstreet · 20 May 2014 at 4:12PM

I wouldn't be surprised if both surveyor and solicitor suggest to lender that this is not a suitable property for mortgage security.

Future resale prospects in event of repossession, non-existent.

ligtning · 20 May 2014 at 11:33PM

Thanks again, good points to consider. Much appreciated

silvercar · 21 May 2014 at 9:01AM

Do you want to live on a development that is going to have little if any maintenance in the next few years, where properties get boarded up as they become vacant, the risk of squatters is high....