Converting commercial to residential

I am in the very early stages of researching the potential purchase of a commercial property with a view to converting it to a residential property. I'm struggling to find a great deal online that is useful about this. I have put out some feelers with some folk I know and thought it would be worth asking you!

Are you using property in the singular, or do you really mean plural? For example are you taking an office and turning it into a single house, or into multiple flats or houses?

Is it the type of commercial property that will allow you to convert it to residential under the Permitted Development initiative or will you need full Planning consent?

If you are trying to get a mortgage to purchase this, that is not going to work. Mortgage lenders only lend against what is, not what will be. No mortgage lender will advance money on a vacant commercial property that you intend to convert. It has to be converted first and ready to inhabit before they will consider lending.

Commercial to residential projects are not difficult to finance, if you know how to do it. The problem is, as the old saying goes, you don't know what you don't know.

To purchase this type of property you will need to buy with either cash, bridging or development finance. On the assumption you don't have the cash (or you would not be asking) your options are bridging or development finance. You need to understand exactly how these types of finance work, whether you are eligible for them in terms of your property experience to date, which lender will offer you the most favourable terms and, most importantly, does the cost of borrowing still make the project viable for you?

As you have said, you are finding it difficult to find out how to orchestrate all this yourself. To avoid making expensive mistakes you will need the knowledgeable guidance of a specialist commercial brokerage.

This isn't something I can explain in a blog, but I would be happy to have a conversation where I can give you clarity on how you can deliver this project.

You can learn more here:

• Contact Kevin Wright over on his Facebook page.
• Browse the Recycle Your Cash online training library by clicking here.
• Attend an upcoming 1-Day Property Finance Masterclass event - Book in here.