Should we proceed with an Indemnity policy for a property with planning uncertainty

dark_knight005

EssexHebridean said:

dark_knight005 said:

Hi @EssexHebridean thanks for the reply. So unfortunately its not really in like a big estate. Its a small estate where all the houses I think have been built by different developers so they are all pretty unique. Ok would you advise going ahead with the indemnity policy and through with the purchase? Everything else on the house seems fine its just been this stumbling block really and we don't know if we are making an issue out of nothing.

The only person who can advise you on that is your solicitor - they have seen the paperwork, and can advise you where you stand legally. In terms of whether you should go ahead with the purchase, that comes down to whether you are content with the report from the solicitor. 

You may have no choice about the indemnity policy (although if the sellers are paying for it, you may as well have it anyway if you are proceeding I would think) as it sounds as though your lenders are in agreement that it should be put in place. 

I'm with the others though - if the room has always been there, there doesn't seem to be any reason for it not to be able to be used as a bedroom from what you have said. What did your surveyor say about it? (apologies if you have already mentioned that and I've missed it). 

Not sure if we are happy with the report as at times the solicitor doesnt seem like they know what they are doing lol. Although we do think everything else is fine but its just because we are first time buyers we are not really sure about anything.

Ok I see, I am just in the process of trying to confirm if the sellers are indeed paying for it. From the initial email from our solicitor it seems to be the case but just double checking.

Well we havent had the survey done yet as the solicitor recommended getting clarification and confirmation on this issue first before getting a survey done. If we go through with this hopefully we will be looking to book one in the next couple of weeks.

DrSpendingLittle

One thing that comes to mind is the implications for council tax. If permission was granted for a 3 bed property, then council tax will be based on that value, which will be lower than for a 4 bed. 

It does seem rather odd to build and market a three bed property which by all accounts is actually a 4 bed property. Surely there is greater profit potential for the developer to sell a 4 bed rather than a 3 bed? 

Is this a leasehold property? Perhaps there was / is some constraint on the land use that led to the granting of planning permission for a 3 bed rather than a 4 bed. Maybe something in the local plan that stipulates bedroom numbers to reduce  impact of development on wider services and amenities / car parking etc etc. 

chanz4

dark_knight005 said:

Hi @user1977 thanks for the reply. So for a little more context, we were sent the title deed and other documents and we were surprised that it said 3 bedroom house rather than four bedroom. So we pointed it out to our solicitor and they said that this is likely a breach in planning permission (which kind of scared us a little) and advised us on getting the sellers to put a indemnity policy in place.

No reason it cannot be considered a habitable room it is upstairs with all the other bedrooms, has windows and I guess it is built to the same spec as the other bedrooms. Its bigger than the third bedroom so I don't think size is an issue for it not to be classed as a bedroom. 

I think as we are first time buyers we are questioning everything as we are unsure on a lot of things. Is it right for a house to be advertised as a four bedroom even though the plans are for a third bedroom? Also should we be concerned about future saleability (as in would someone else pick up the issue and put them off)?

council tax be lower and water rates

EssexHebridean

Yes - that’s a good point about the Council Tax - probably worth checking there isn’t an improvement marker against it. 

sheramber

Are there any requirements for a four bedroom house that would not apply for a three bedroom such as number of toilets/bathrooms?

If so, calling the fourth bedroom a playroom may have got round that.  

dark_knight005

EssexHebridean said:

Yes - that’s a good point about the Council Tax - probably worth checking there isn’t an improvement marker against it. 

Thanks all. How would I go about checking this?

dark_knight005

sheramber said:

Are there any requirements for a four bedroom house that would not apply for a three bedroom such as number of toilets/bathrooms?

If so, calling the fourth bedroom a playroom may have got round that.  

Not sure. It has a downstairs toilet and then upstairs there is a bathroom and the master bedroom has an en-suite, which I guess is pretty standard for four bedroom houses.

peterhjohnson

DrSpendingLittle said:

It does seem rather odd to build and market a three bed property which by all accounts is actually a 4 bed property. Surely there is greater profit potential for the developer to sell a 4 bed rather than a 3 bed? 

Yes, I thought that but this was originally a self-build house. Maybe the self-builders wanted 3 beds plus playroom so that is what they put in the plans?

user1977

Sorry, does chucking a bed into a playroom really bump up the council tax?

EssexHebridean

dark_knight005 said:

EssexHebridean said:

Yes - that’s a good point about the Council Tax - probably worth checking there isn’t an improvement marker against it. 

Thanks all. How would I go about checking this?

Go to this site: https://www.gov.uk/council-tax-bands

Once you have brought up the details for the property you are looking at, it will show if it has an improvement indicator against it. Essentially, it means that the Band that the current owners are in is liable to change when the property is next sold. 

More info here: https://valuationoffice.blog.gov.uk/2023/07/13/how-home-improvements-affect-your-council-tax-band/

user1977 said:

Sorry, does chucking a bed into a playroom really bump up the council tax?

Massively unlikely, but good practise to check for improvement indicators before buying generally, I'd have said!