Buying house with a granny flat

Slimmy123

Hi all,

I'm after some help really to see if my brainwave has anything behind it. Me and my wife have been told we can borrow upto £280'000. We have seen a house we like for £330,000. This house though has a detatched 2 bedroom bungalow in the garden which my wifes parents would rent for £600 a month. With this in mind could we go to a mortgage company and have that £600 added onto our affordability calculator or would it then need to be a buy to let mortgage as we wouldn't have a deposit big enough for 25%.

Hope this makes. Thanks all.

Mr.Generous

you cant use rent for income calc, also have you considered the stamp duty surcharge, granny annex/flat/bungalow all count as second property and you have to pay the 3% surcharge.

G_M

As it' a self-contained building, any rent-paying occupant would be a tenant (not a lodger).

So you'd need a BTL mortgage.

You'd not be able to take the rent into account for affordability tests.

You could probobly buy it on a residential mortgage provided you could afford it on your income alone (and then receive some pocket money from your parents - but shhh.... I didn't suggest that!)

booksurr

Mr.Generous wrote: »

you cant use rent for income calc,

agreed

Mr.Generous wrote: »

also have you considered the stamp duty surcharge, granny annex/flat/bungalow all count as second property and you have to pay the 3% surcharge.

no, they do not all count

to count they must tick the following boxes:

• Be capable of being sold separately from the main house
• Have their own entrance
• Have their own water and electricity supply
• Receive their own Council Tax bill
• Be worth more than £40,000 on their own.
• Be worth less than 1/3 of the total value of the whole dwelling (ie main house + "granny" bit)

Cakeguts

Find out if there is planning permission for the bungalow. You don't want to buy a house and then find that you have to demolish something you have paid for.