Whether you're buying or selling a property, there are no doubt a few speed bumps that have served to hinder your progress towards that desired completion date.
It might be that you're part of a long chain that's been complicated by something somewhere along it. Perhaps obtaining finance is proving difficult for one buyer, or a significant issue has arisen in one of the property's surveys, forcing buyer and seller to renegotiate the agreed price to cover the cost of any work required. And so on.
Or perhaps it's the finance that's affecting you directly, either as buyer or seller.
When a buyer submits their mortgage application, the lender assesses the property to decide whether they're willing to take on the risk, and if so, how much they'll lend.
Much of that decision comes down to the lender's valuation of the property, matched against what they believe the applicant can afford in repayments. After all, a mortgage company is a financial business. Its decision isn't based on altruism towards the borrower but on protecting its own investment, in case the borrower defaults, and making sure the property itself is a viable asset to lend against.
1.5 million properties, £300billion trapped
Specialist lender Together has carried out research into the housing market to understand how many homes fall into the "unmortgageable" category. It's a striking figure: some 1.5 million properties across the UK will struggle to secure a mortgage and are therefore essentially unmortgageable.
Together's report also points to over £300billion of equity value trapped in these properties, meaning remortgaging plans are affected too. According to the same research, there are 101,283 post-war non-standard, and therefore unmortgageable, properties in Birmingham alone.
What makes a property unmortgageable
So what actually puts a property in this category?
Missing basic facilities. There are 323,000 homes in England classed as lacking basic modern facilities, usually a bathroom or kitchen.
Falling short of the Decent Homes standard. 3.5 million properties fail to meet the expected standard, whether that's sub-standard or absent cooking and washing facilities, or unsafe features that could endanger life.
Overall condition. Where the asking price plus the cost of fixing the problems flagged in a survey is too much for a lender to risk.
Location. Proximity to commercial premises, council refuse and recycling centres, or industrial use can all cause problems, as can current or prior flooding and flying freeholds (where part of a property is only accessible over, above or through another).
Listing status. Where the maintenance requirements and restrictions on change give a lender pause.
Cladding. Partly down to the aesthetic and demand for that type of property, but mainly because of safety concerns and the cost of removal.
Thatching. The chocolate box appeal might attract buyers, but the maintenance and fire risk is often enough to make a lender balk.
Non-standard construction. Prefabricated, timber framed, pre-cast reinforced concrete or other unusual construction materials can all be enough for a lender to decline an application.
What buyers and sellers can do about it
Specialist companies, like Together, do provide finance for these more troublesome properties. There's also the auction route, often the best way to find an otherwise desirable property, or one in a good location, for a much lower price.
For sellers of such a property, it's worth doing your homework. Talk to a mortgage specialist about what your options are, and get ahead of the inevitable questions by commissioning a building survey on your own property, so you can include the findings in your sales pitch. It's also worth being upfront with any cash buyers who show interest, since they aren't relying on mortgage finance to complete.
However you're approaching your property project, you'll need effective and focused representation to make sure the legal side of things is handled as quickly and efficiently as possible, with the experience and knowledge to protect you throughout the transaction. This is why you should talk to Homeward Legal as soon as possible to get things moving.
Talk to Homeward Legal
Our conveyancers at Homeward Legal will start work on your plans as soon as you agree to the quotation and appoint them to represent you.
Call us now on to get your conveyancing quote started, or to discuss your concerns about your plans to move. Or get a quick quote using Homeward Legal's easy to use quote generator.