As demand for housing rises and availability shrinks, large numbers of buyers have broadened their search and are purchasing ex-council properties, flats over commercial premises and houses adjacent to restaurant and bars.   As well as being more affordable, this is also due to the increase in popularity in post war architecture.
Whilst historically these properties have been difficult to get a mortgage against, lenders are now more willing to approve loans for these types of homes, although there is still some resistance among many lenders.
London particularly has seen a tenfold increase since 2009 in the number of first time buyers purchasing ex council flats and houses.  Local authority properties that have stood the test of time, and not been demolished, are among the best builds in the country. Often better constructed than today’s modern city centre apartments, they are generally more spacious and better planned. In addition, ex local authority homes tends to be cheaper to buy and maintain than, for instance, Victorian properties.
Outside of London, the numbers of first time buyers purchasing these types of home has doubled over the past ten years, and the interest in likely to continue as savings can be substantial when compared to purchasing other types of properties. On average, buyers can save as much as 38 per cent – more in the North East.
Old perceptions still linger among many lenders, however. Where available, rates may not be the most competitive. Many lenders exclude certain properties, such as flats above shops and high rise tower blocks as they still consider them to be harder to sell in a downturn.  The construction type can also be another factor. Pre-cast reinforced concrete (PRC), common in 1960s built apartment blocks, are likely to make getting a mortgage difficult, although a Surveyor should be able to tell you whether a building has been reinforced or not.
Where lenders are willing, they may restrict loan-to-value to 70-75 per cent or more, rather than 90 per cent.
It is, therefore, vital that potential buyers check with their lender before pursuing a valuation as it may rule out these types of property and be a waste of time and money.
© www.propertysurveying.co.uk
VJY
3-Nov-16