How To Convert a Commercial Property Into a Residential

[@DanHPRltd]

Hello, thanks for the video. Some really helpful information. I'm a little bit confused with the permitted development and prior approval bit. I'm buying a property that is class E and I want to convert it to class C3. As far as I can understand this comes under permitted development rights at the moment but I also need prior approval which is different to what you said in your video. Just wondered if you had any advice on this? Cheers

[@KevinWrightProperty]

Hi Dan - my advice is to consult a specialist website dedicated to planning. My specialism is on finance, not planning, so I am not going to tread on the toes of those with greater planning knowledge than me. here is the website you need to go to for the answers you seek - www.planninggeek.co.uk

[@mah203]

Sorry to ask, but at 6:12 you say to click link below that you would be happy to have a look. Which link please? Thanks.

[@KevinWrightProperty]

good question - if you want to email me with a deal to be brokered, the link for that is on the home page, click the ABOUT tab

[@topboyuk]

Great video can I ask if you could start selling them floor by floor or would you have to wait till all 3 floors are completed. Ie could I sell 6 flats on first floor and then wait and use funds to complete the rest of the development.

[@KevinWrightProperty]

no reason why you could not sell floor by floor. At the very least, lock buyers on with an exchange of contracts - developers do this routinely.

[@kyle286]

Hey Kev, how do you go about turning into separate dwellings once complete? A shop and 2 floor 2 bed flat, into 3 1 bed flats and a small shop? Also, I’d SA the flats as I do that already… Not sure if matters

[@KevinWrightProperty]

If by, separate dwellings, you mean that each is on their own title at Land Registry Kyle, then you just engage a solicitor to separate the titles. You will also need the solicitor to create a lease for each separate dwellings. Bear in mind that you cannot be both the freeholder (who still owns the land) and the leaseholder (who own the right to occupy the dwelling) - so these will need to be different entities. The question would be, why go to all that bother, when you can just leave the whole building on a single title and rent it out exactly the same? SA usage only matters in terms of the mortgage you get, as you have to get a lender that permits short term letting - standard BTL lenders prohibit this, as hopefully you already know?

[@GASA90]

Hi Kevin, I wanted to follow up on the question above. My understanding is that when you complete a title split your chances of getting a higher valuation increase of there are similar flats nearby. Is this correct?

[@KevinWrightProperty]

@@GASA90 sorry for the delayed response, I only just became aware of your question. The closeness of proximity of similar flats is not a driver in the valuation derived by a RICS valuer. They will base their valuation on similar flats in the vicinity but the closeness of them is unlikely to be an influence.

[@steveharman8907]

Hello again Kevin...hope you're having fun over there in the Spanish sun.?.....how do you find out if it is Green, Am er or Red light property.?..please.

[@KevinWrightProperty]

pretty simply Steve - go the the website www.planninggeek.co.uk - it has a comprehensive explanation of what you can do under PDR, what needs prior approval and what needs full planning applications

[@JakShiit]

We are looking at buying a commercial property that has just had a change of use to residential use. It is just under 700m2 and am wondering what happens with council tax ??

[@KevinWrightProperty]

you have to pay it

[@JakShiit]

@@KevinWrightProperty of course, but we are waiting to here from the owners agent as to what he is paying currently, which I assume will be a commercial rate and how that transitions over to council tax. I guess that depends on the amount of bedrooms and if the property gets divided up into 3. I assume their may at least be a discount during the development process

[@KevinWrightProperty]

@@JakShiit a commercial property retains its commercial usage, and thus requirement to pay Business Rates, until the council give it a Certificate of Habitation, to evidence that it is no longer commercial but residential. From that point Business Rates ceases to be payable and it is assessed for Council Tax instead

[@lefayebrenna]

Hi Kevin, I'm looking at a large, four-story building with big open studio spaces on two of the floors. I'd want to convert at least 1 - if not 2 of the floors - into a living space for myself and keep the rest as a working studio space that I'd operate. Would what you've discussed still be applicable, if I'm wanting the premises to function as commercial and residential? (love the very informative channel btw!x)

[@KevinWrightProperty]

Thanks for your question Brenna. From a planning/PDR point of view, your idea looks feasable, plenty of commercial buildings are what is termed as 'mixed use' i.e. part commercial but also part residential. Look at any shopping parade and you will see shops on the ground floor but flats above them, so that concept is well proven. As wth any change of use, you need to define if what you propose comes under Permitted Development Rights (PDR), meaning you already have planning permission to carry out that specific change of use - or it needs to be submitted to the local planning department for full planning approval. A planning consultant local to you would be the person to guide you on this, you can Google to find them. Where you may find a spoke in your wheel/spanner in your works is getting funding for this. Mortgage lenders generally like to keep separate where you live from where you work, unless its a sort of bedroom with an office desk and computer type of arrangement. So you would need guidance from a great mortgage broker to make sure that the mortgage you got was compatible with these uses you propose. That would be a role our brokerage could take on for you.

[@Southbronx134]

Hi Kevin i have my own property that i own with no mortgage on it and have just built a garage in the rear of the property but have started up a small vehicle mechanic buissnes is it possible to make a change of use to my garage and make it in to commercial use for a buissnes at my own home if so how do i go about it in scotland

[@KevinWrightProperty]

Hi Mikey, what you are asking is a planning issue and my background is finance, not planning. I would suggest you visit this website as it contains an encyclopedic amount of planning knowledge - www.planninggeek.co.uk/

[@MariMusaBandele]

Interested in using a VA mortgage loan. I'd like a commercial property and I'd like to convert it into a home in the form of a duplex or triplex property. Is this something you can assist with?

[@KevinWrightProperty]

what you need to know is mortgages are for already converted properties. You will not find a mortgage lender who will give you a mortgage when your intention is to do as you say - no one can assist you with a product that does not exist. You have to buy it first, do the conversion, then get a mortgage on the finished property. You need to rethink your approach here and buy the property with a) cash or b) bridging finance. VA mortgage loan?

[@GemmaFrase]

Hi Kevin, would that also be the case for a shop that you wanted to convert to uppers? Could you get a mortgage for the commercial and then just convert the upstairs to residential on a commercial mortgage and then split the title and get a new mortgage for the residential upstairs? Would really appreciate your help, thank you

[@nassah2010]

Hi kevin, i've project managed two commercial to resi projects. What proof will a lender need to see that i managed this and have experience?

[@KevinWrightProperty]

just the documentation to show what you paid for them, what you spent on them, what you sold them for. Solicitors completion documents would suffice for the first and third parts.

[@erudicity1126]

Brilliant information Kevin. Will be in touch by email soon 👍

[@KevinWrightProperty]

thank you Andre

[@JessieJussMessy]

Hey Kevin, it seems you've used quite a bit of terms that aren't particularly friendly to the layman (nomenclature). I would recommend elaborating a little more on what you mean by things like 'net net profit' or a 'ROBUST' plan and such. Any nomenclature should be clarified for the sake of beginners and greens like myself. This is a surefire way to make your content accessible for a much more MASSIVE audience, even those who didn't know they might be interested! Cheers 🥂

[@KevinWrightProperty]

sure - net net profit mean profit after ALL costs are deducted Robust means will withstand the scrutiny of a lenders valuer What else do you want explaining?

[@KevinWrightProperty]

those that didnt know they might be interested are not really the audience I am chasing Jessie. I dont see it as my role to convince people that they should invest in property if they have not worked that out for themselves already. I look to show those that already know that how to do it smarter. Elaborating on terms that are not clear though, very happy to do that

[@JessieJussMessy]

@@KevinWrightProperty That strategy makes perfect sense. You know your target audience well. I appreciate your response and explanations! I'll be checking through your content 🥂

[@KevinWrightProperty]

@@JessieJussMessy you are most welcome to

[@Walmdog420]

Hi Kevin, how hard would it be to change to a residential for your own living purposes I.e your own family, not renting out or HMO? Would you still be viable for annual rates?

[@KevinWrightProperty]

Hard in terms if you need to be living somewhere else, as you cannot live in your own BTL or HMO - mortgage lenders prohibit you doing so. If you have a mortgage, you would need to change mortgage products, in almost all cases. Rates, in the form of Council Tax, are always payable. No council gives up income producing opportunities.

[@zainadunn4827]

My landlord has now noticed the new rules and took away my parking loading after 15 years.

[@KevinWrightProperty]

that's a shame

[@timsilver777]

Didn’t say darn thing

[@KevinWrightProperty]

what were you expecting it to say?

[@JessieJussMessy]

​@@KevinWrightPropertyBeing that timsilver777 didn't respond over the past 3 months, I think it's safe to dismiss their comment. No constructive input is no real input at all

[@KevinWrightProperty]

@@JessieJussMessy agreed