Splitting land titles on a country estate allows purchase with residential and buy to let mortgages

Area
Buckinghamshire
Capital Raised
£3.08M

Substantial country estates offer attractive potential to buyers, with outbuildings offering potential rental income from business units or home rentals. But a mixture of owner-occupier and rental can be problematic for lenders.

The Scenario

Our client, a senior manager in corporate hospitality, was buying a beautiful 4-bedroom manor house on a 67-acre estate in Buckinghamshire for her family. In addition to the substantial main house, a stable block annexe offered additional accommodation in two units – one with four bedrooms, the other with three, plus kitchen / living areas. There was also a 3-bedroom entrance lodge; our client intended to rent the additional accommodation out as three separate units.

The estate was being sold as one title, but mortgagors are reluctant to lend on properties that combine residential and rented properties, because of the issues involved with evicting tenants should the borrower default on the mortgage.

The Solution

The answer was to put the rental properties on four separate titles: the main house, each of the stable block units, and the entrance lodge.

It can seem like a daunting amount of legal work, but a vendor will quickly be aware that any purchasers needing finance will face similar issues. And in this case they were still only dealing with one highly-motivated buyer.

The legal costs of £500-£600 for each title transfer were manageably absorbed into the total purchase costs, and we were then able to arrange the four mortgages for our client: one residential and three buy-to-let.

Alex Chambers

Senior Finance Broker

Bristol

0117 403 4324

Have a similar situation? I'm a specialist in residential and investment property finance for UK and international clients. I look forward to hearing from you.

Luther Yeates

Finance Broker

Bristol

0117 244 5561

Have a similar situation? I am a specialist in residential and investment property finance for UK and international clients. I look forward to hearing from you.

James Palmer

Senior Associate

London

0203 900 4322

Have a similar situation? I specialize in development and commercial finance and can provide creative solutions for your property funding requirements.

Sam ONeill

Senior Finance Broker

Bristol

0117 959 5094

Have a similar situation? I specialize in bridging finance and can provide creative solutions for your property funding requirements.

Robert Gibb

Senior Finance Broker

Bristol

0117 959 5094

Require mortgage or short term finance for residential or buy to let property (including HMOs and limited companies)? I have extensive experience on providing property finance solutions for UK and International clients.

Adam Arnott

Senior Associate

Bristol

0117 205 0214

Are you in a similar situation? I have extensive experience in advising clients on providing creative property finance solutions. I look forward to hearing from you.

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