For many, buying a house surrounded by land is their ideal home. Alongside the privacy, a large acreage offers flexibility in how the land is used or protected. In most situations where you simply want to buy a property with a large estate and live there, you shouldn’t have much trouble finding a residential mortgage with large acreage. However, if you intend on using the property or the land for commercial purposes – whether to create a farm or to develop a rural business – you’ll require a commercial mortgage from a commercial lender.
If you intend on using some of the land for residential purposes and some for commercial purposes – e.g. you intend to live in the property but use the land for commercial farming – you may be able to arrange a commercial residential hybrid mortgage through a specialist lender.
Specialist lenders should be able to offer a “semi-commercial mortgage” in case you wish to also use the land for the following commercial purposes:
- Develop the outbuildings on the land for office use
- Seek planning permission for residential development
- Holiday lets and Airbnb
- Equestrian centre
- Leasing land to farmers
- DIY farming
- Annex for family members
- Cattery
- Kennels
- Staff accommodation
Even if the property you intend to buy and use only for minor commercial purposes, you’ll still need a semi-commercial mortgage or a residential mortgage that allows for up to 40% of the property to be used for commercial purposes. The only caveat here is that if the property has separate access for its commercial and residential aspects, then some lenders will offer 2 separate mortgages.
Depending on your intention and the land itself, the mortgage application process will likely to include a detailed assessment of your plans. It’s also likely that the more complex your requirements, the more likely it is you’re need a mortgage broker to source suitable products from the right lenders.
