New initiatives have been launched in 2017 to provide bridging loans for landlords to fund the purchase of empty properties.
There are many empty properties on the housing market that landlords could buy. Most of these properties require renovation work to make them habitable. New boilers, bathrooms, kitchens and better insulation are among the most common improvements need to make them suitable for tenants to live in.
Many mainstream lenders are reluctant to provide loans to purchase empty houses, especially ones that are in a semi-derelict or uninhabitable condition. Landlords that have their commercial mortgage applications turned down for empty property deals can turn to bridging finance organisations, who can provide short-term bridging loans for empty property. After the necessary improvements, the property may then be eligible for a commercial buy-to-let mortgage and the bridging loan repaid.
Market Financial Solutions, a bridging finance lender, has launched an initiative where it is making £20m available for bridging loans of between £100,000 and £1m that can be used to specifically purchase empty housing and renovate them.
In March 2017 Cambridge Council created a scheme to give £25,000 interest free loans to owners of empty property in the city to enable them to make their homes uninhabitable. The only condition was that they charge tenants an “affordable” rent.
Landlords considering purchasing empty property should consult a broker who can give advice and locate the best bridging loan deal to raise the necessary finance.