Thinking about buying a property for renovation?
We chatted with Hannah about her own experience of renovating a barn during a global pandemic. She shares some useful insights into a world that can be daunting and filled with unforeseen obstacles.
When I acquired the barn, it was not habitable, so I was not able to get a standard residential mortgage. My options were either a bridging loan, (expensive) or a build loan mortgage where payments are made in stages. I decided to take the build loan option and luckily only had two instalments with most funds given in the first payment.
The barn shares access to my parents’ farmhouse. Shared access also posed an issue as many mortgage lenders would not even consider it, even though the value of the property and land far outweighed what I was asking to borrow.
To get a build loan mortgage there were several requirements:
- A breakdown of costs of labour and material, each tradesman had to fill in a form to state experience and hourly rate.
- A costly structural warranty and site insurance. A total of £3,000 for both. Considering I only wanted to borrow £50k this was a hit before I started.
- Plus, all the relevant planning permissions, architect drawings, explanation of any large outgoings on bank statements, wage slips, ID etc.
Here are just some of the items required for a structural warranty:
- Reclaimed roof tiles should be assessed by a suitably qualified person for a minimum 15 year lifespan.
- Proof of suitable foundations, they need all structural details.
- Certificates for damp proof coursing to last a minimum of 10 years.
- Certificates for electrics, log burners, boiler, EPC, and SAP for the property.
Work had started on the barn 10 years ago; all the main structure had been renovated to stop the planning from lapsing. This caused more issues! Some of the structural warranty had to be completed retrospectively and reliant on building control sign-offs. Then introducing COVID19! The council could not access old records due to the pandemic and office closures and the structural warranty had to be signed before I could request the final payment of the mortgage. It was a stressful time!
I have now received the final instalment and am in the process of transferring onto a regular cheaper residential mortgage so I will encounter a penalty of £1,000 for leaving the build loan mortgage early.
There is one positive of converting a barn! You can claim much of the VAT back and there is a comprehensive list which was a nice surprise.
I admit that I was completely naïve to the cost of many aspects of a self-build. I went over budget as many projects do. To save some money I tried to do what I could by myself including the painting, however, I soon discovered that my vocation is not to be a painter and decorator, as I am afraid of ladders!
I have never done anything like this before and I would not recommend attempting it through a global pandemic! It was extremely stressful, and I was constantly problem solving. However, I was incredibly grateful that I work where I do, as I had constant support and knowledge from the team.
My barn is converted, and I am now living in my dream home!
If reading Hannah’s experience has inspired you to renovate and you would like further advise on how best to approach this, our team at Barbers Rural are happy to help.
Dan Bowden can advise on planning permissions, Annabel Fearnall leads valuations, and our network of professional advisors are on hand to support in any other way.
Contact details are on our home page.