Do you want to buy a castle? It may be more affordable than you think! A mortgage on a castle can be a great option for business owners or families who want to live in luxury. Below, we discuss the process of taking out a mortgage on a castle and how to go about finding one. Whether you're in the market for your very own fairy-tale fortress or just want to learn more about castle mortgages, read on.

Why Buy a Castle in the UK?

Here are some key reasons people choose to buy a castle in the United Kingdom:

Investment Opportunity

If you're looking for a unique investment opportunity, buying a castle in the UK can be a great option. Not only are castles a symbol of British history and culture, but they also offer a number of practical benefits. For instance, castles are typically located in scenic areas, which can make them perfect for luxury tourism.

In addition, because castles are large buildings with considerable land, they can easily be converted into apartments, hotels, luxury rented accommodation or event venues. With the right care and attention, a castle can be an excellent source of income and a lasting investment. This means buying a castle in the UK is worth considering if you're looking for an unusual and potentially profitable investment.

Restoration Project

If you're the type of person who enjoys taking on challenging projects, buying a castle in the UK can be a great option. Restoring a castle to its former glory is no easy feat, but it's an immensely rewarding experience. Not only will you get to breathe new life into a historic building, but you'll also have the satisfaction of knowing that you're the one responsible for its upkeep. By restoring a castle, you'll be preserving a piece of British history and culture. Plus, if you're looking to re-sell your castle later down the line, you’ll likely generate a healthy return on investment.

Versatile Uses

In addition to being luxurious and imposing, castles also offer a number of practical benefits. For instance, they typically have large grounds, which can be perfect for hosting events or starting a business. And, because they're such unique properties, castles often come with a number of fascinating features like secret passages, hidden rooms, and historic artefacts, which you can turn into any use you'd like. The possibilities are endless with these one-of-a-kind properties, meaning you can make the most of it however you see fit.

Are There Any Downsides to Buying a Castle?

It's worth keeping in mind that there are also a few potential downsides to buying a castle:

Acquisition Cost

Firstly, castles can be very expensive properties, so you'll need to have deep pockets if you're serious about purchasing one. In general, the bigger the castle, the pricier it will be. So, if you're set on owning a castle, you may need to compromise on size or look for an alternative property that's more within your budget.

Maintenance Costs

Another potential downside of buying a castle is that it can be expensive to maintain. Not only do castles require regular repairs and upkeep, but they also need to take out home insurance for a much higher value than most properties. So, if you're considering buying a castle, make sure you have the financial resources in place to cover any unexpected repairs or maintenance costs.

Running Costs

Castles also come with a number of running costs that you'll need to take into account. For instance, you may need to pay for staff to maintain the property and grounds. Expect to have considerable utility bills to cover, too. In addition, if you're planning on running a business from your castle, you'll need to factor in the cost of marketing, insurance, and any necessary licenses or permits. So, before you purchase a castle, be sure to do your research and budget for all potential running costs.

Planning Permissions

If you're looking to make any changes to your castle, such as converting it into apartments or adding a swimming pool, you’ll need to apply for planning permission from the local authority. This can be a lengthy and complicated process, so it's important to factor this in when considering buying a castle.

Despite these potential drawbacks, buying a castle can be an immensely rewarding experience. If you're prepared for the challenges involved and have the financial resources in place, owning a castle can be a great way to invest in British history and culture. Plus, it's an investment that’s likely to bring you a healthy return and appreciate in value over time — all in all, buying a castle can be a great idea.

How Much Do Castles Cost?

In the UK, castles can range from £600,000 to £6 million or more. Of course, the price of a castle will depend on its size, location, and condition. If you're serious about buying a castle, it's important to do your research and budget accordingly. Scotland is a particularly good place to find castles for sale, as there are a number of historic properties on the market. Plus, the price of a property in Scotland is generally lower than in other parts of the UK, so you may be able to get more for your money.

Europe is home to some of the most iconic castles in the world and many of these are available for sale. In France, for example, you can purchase a 12th-century castle for around €500,000. In Italy, there are several medieval castles on the market for around €800,000. If you're looking for a truly luxurious property, buying a castle in Europe could be the perfect option for you. Bear in mind, though, that the renovations on these properties can often be very costly even with the lower acquisition cost.

Where to Find a Castle for Sale

Contrary to what you might believe, castle properties aren't difficult to find. You may begin your search at international real estate firms that offer luxury property.

  • Le Figaro Properties - this French site has a range of over 1,000 castles for sale, from medieval properties to more modern chateaux
  • Christie's International Real Estate - this firm offers high-end real estate around the world, including a number of castles in Europe
  • Sotheby's International Realty - another luxury real estate firm with a selection of castles on their books
  • Knight Frank - this UK-based firm has a number of castles for sale, as well as other historic properties
  • Prestige Property Group - this is another UK-based firm that offers a range of castles and stately homes for sale

If you're looking for something a little more budget-friendly, check out sites like Rightmove and Zoopla, which list properties for sale in the UK, including some castles.

Castle Mortgage Eligibility

Castles are considered non-standard construction buildings, which includes any building type that does not meet the definition of conventional construction with stone or brick walls, and a tile or slate roof.

Castles are designated as listed buildings, just like any property built before 1840. There are several levels of listed buildings, each with its own set of consequences for mortgage approval. Grade l refers to "buildings of exceptional interest," which many castles fall under. Due to the risks that Grade I constructions may pose; many lenders refuse to finance them. This is mainly due to the ageing and potential unsafe condition of the building, saleability and/or habitability concerns.

All of these factors combined can make it difficult to find a mortgage lender who is willing to provide finance. However, there are now a number of specialist lenders who consider lending on castles, so it's worth shopping around to see what options are available. Use an independent mortgage broker such as John Charcol, with access to the whole market. This means we can find specialist lenders able to provide you with a mortgage, even if your castle presents criteria that make it difficult to mortgage.

How to Get a Mortgage on a Castle

When applying for a castle mortgage, you'll need to provide the same documentation as you would for any other property, including proof of income, employment history, and credit score. In addition, you’ll need surveyors to assess the property and provide a valuation. This is because castles can be difficult to value due to their unique nature, so lenders will need extra reassurance that the property is worth the amount you're borrowing. Plus, lenders will need to understand the extent of repairs that may be needed, as this will affect the amount they're willing to lend.

When you take out a mortgage on a castle, you'll also need to have a larger deposit than usual, as castles are considered to be high-risk investments. You can also often expect to pay a higher interest rate on your mortgage, as lenders will view you as a higher-risk borrower.

If you're considering buying a castle, one of our specialist mortgage advisers can help you navigate the process. By working closely with a market-wide range of providers, brokers can help you find a competitive mortgage that meets your needs.

How to Finance a Castle Restoration

If you need to take out a large mortgage to buy a castle, you may be able to use a secured loan as collateral to obtain a larger amount.

However, if you have the financial resources to do so, bridging finance may assist you in acquiring a castle that needs to be redeveloped. Remember that, in this case, you'll need proof of a clear exit strategy plan since your lender will require evidence of a post-development remortgage value (this is unless you're restoring the castle to sell it).

Development Finance

The majority of castle purchases are made for development purposes, as discussed above. Development finance is a term that refers to loans obtained for the express purpose of developing an asset. Development loans are frequently available on a short-term, interest-only basis and have many parallels to bridging financing.

Development finance providers cover the amount of a project's development loan in portions, according to a certain schedule. Lenders will conduct site inspections on a regular basis before each instalment is released after they have verified that the works are proceeding as planned

High Net-Worth Mortgages

Even if you have the money to make a significant purchase outright, you may consider taking out a mortgage so that you don't tie up all of your funds in one investment.

You'll need to contact a broker like John Charcol, who specialises in this sort of mortgage, to work with you as a high-net-worth customer. Many high street lenders have a limit on how much they will lend, and many don't have the required expertise to deal with the unique aspects of castle ownership.

Factors to Consider When Choosing a Castle

When you're looking to buy a castle, there are some important factors to consider. Here are some of the key things to think about:

  • Age of the castle - older castles will often need more extensive repairs, which can be expensive. You may also find more unexpected issues when carrying out a survey on an older property
  • Condition of the castle - as well as the age of the property, you'll need to think about its condition. A well-maintained castle will be easier (and cheaper) to insure and protect than one that's in disrepair
  • Location of the castle - consider both the immediate surroundings and the wider area. Is the castle in a remote location? If so, you'll need to think about access, both for you and your guests. You should also research crime rates and flood risk in the area. If you’re looking to turn your castle into a business, make sure it’s in a location that will be attractive to tourists and event planners
  • Size of the castle - larger castles will obviously come with higher running costs. In fact, the size of your castle will impact everything from your energy bills to the amount of furniture you'll need to buy
  • Features of the castle - castles come with a wide range of features, from turrets and towers to moats and drawbridges. Some of these will be more expensive to maintain than others, so it's important to bear this in mind when making your decision
  • Local rules for buying castles - some local rules may prevent you from doing certain things. For example, your renovations may be limited because they don’t adhere to the architectural history of a castle
  • How and where you want to live - this is probably the most important factor of all. If you're planning to move in, think about how you’ll furnish the rooms and whether you'll need to make any changes to accommodate your family. Also think about a location that’ll suit you, not just your potential guests. If you're going to rent it out, think about how you will manage the property and if you'll be happy to live with tenants or guests. You'll also need to consider the practicalities of living in a castle, such as the cost of heating a large property and the lack of privacy you may have if it becomes a business.

Mortgage on a Castle — The Bottom Line

All in all, buying a castle can certainly be a daunting task, but it's definitely possible with the right mortgage. Make sure you do your research and speak to an independent broker such as John Charcol to get the best deal possible on any type of home.

Don't forget to consider all the factors that come with owning, renovating and running a castle. With a little consideration and planning, you can make your castle dream a reality.

Want more information on the process of buying a property? Check out our comprehensive house buying guide. We have a team of specialist advisers who are experienced in helping people purchase unusual properties such as castles, so we can make the process as smooth and stress-free as possible. Contact us today to find out more.

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