Flats Above Shops

Lolbot1

teddysmum wrote: »

I don't know anything about the buying side, but would you be happy to find that the business under your flat becomes a takeaway with lingering food/cooking smells ?

I know where you are coming from but I felt fine with it. It's along a parade of shops and being a top floor double glazed flat it doesn't suffer from any noise or smell.

Lolbot1

davidmcn wrote: »

The mortgage valuation part of the Home Report usually does describe what the building comprises, I'd be surprised if it doesn't mention that it includes commercial premises? Though that's just for the lender's benefit, obviously you've seen the property anyway!

There will be mortgage possibilities, if restricted - probably best to go via a broker rather than try pot luck yourself. I suspect some lenders will apply different policies depending on what the local market is like - as you say, it's pretty standard for Scottish high streets to have several stories of flats above the shops.

Home Report did list it as above a shop but I've seen some that say 'this property is not suitable for mortgage' because of this - in my case it says that it *is* suitable for a mortgage.

I am with a broker but they are based in England and I think that might be part of the difficulty in not understanding the local market and standard practices.

rentmekid

best to get a Scottish broker when purchasing in Scotland

davidmcn

Lolbot1 wrote: »

Home Report did list it as above a shop but I've seen some that say 'this property is not suitable for mortgage' because of this - in my case it says that it *is* suitable for a mortgage.

Hmm, I'd be surprised at any which categorically say it's unmortgageable merely because it's above a shop, perhaps some other reason? If the shop is already something like a hot food take away (or a pub) then the mortgage choices will be even more restricted.

Lolbot1 wrote: »

Whilst we are here, does anyone know why the home report value is always significantly lower than the market price? Do mortgage lenders take this into account?

Depends what you mean by "the market price" - the home report value is the open market valuation i.e. what the surveyor thinks is the justifiable price based on past sales of similar properties and standard RICS criteria. What it actually sells for might be different e.g. if it goes to a closing date then the bidding could soar some way above the HR value, or if it's more difficult to shift then a seller might accept something less. Lenders will base their figures on the lower of the HR valuation and the agreed sale price.

amateur_house

This isn't Scotland, but you may find it interesting to read someone else's experience of buying a flat above a shop

https://www.theguardian.com/money/2017/apr/29/flat-value-fell-restaurant-opened-below-planning-policy

davidmcn

amateur_house wrote: »

This isn't Scotland, but you may find it interesting to read someone else's experience of buying a flat above a shop

https://www.theguardian.com/money/2017/apr/29/flat-value-fell-restaurant-opened-below-planning-policy

Luckily none of that permitted development stuff applies in Scotland. Shop to a restaurant would require full planning application (though obviously still a risk that it would be granted).

Lummoxley

amateur_house wrote: »

This isn't Scotland, but you may find it interesting to read someone else's experience of buying a flat above a shop

https://www.theguardian.com/money/2017/apr/29/flat-value-fell-restaurant-opened-below-planning-policy

The author comes in for some stick in the comments.

Lolbot1

Lummoxley wrote: »

The author comes in for some stick in the comments.

I did see this yes! Thankfully I'm not looking to make a lot of money on the property market, just a home!

HWG

Call up your preferred lender and ask - they should be able to tell you straight away.

It will depend on what sort of shop it is. If it trades outside of normal business hours (eg a corner shop), uses cookers or heaters (eg cafe selling toasties), or uses any chemicals (eg nail salon), you might struggle. If it's something pretty mundane (eg shoe shop), you should be fine.

I had to pull out of a sale because the flat I was trying to buy was four stories above a nice little cafe - but because it sold baked potatoes and soup, it was classed as a premises selling hot food, and none of the major lenders would touch it.

I was stunned, as so many flats in UK cities must fall into this category.

GingerFurball_2

Lolbot1 wrote: »

Whilst we are here, does anyone know why the home report value is always significantly lower than the market price? Do mortgage lenders take this into account?

Your lender will lend against whichever is lowest of your purchase price or the home report valuation.