Mortgage Lending Options
Lots of people in the UK look for a property with an annex. This can be an excellent way to set aside a space to work from home, as a private workshop, or as living accommodation for an elderly relative.
However, we also receive many inquiries about mortgaging a property with an annex - often from homebuyers worried about the additional costs, or whether they will qualify for the mortgage they need, whether they need a bridging loan to fulfill their needs.
In this guide, we'll summarise how financing a property purchase with an annex works, and all the crucial factors mortgage lenders will consider.
What is Considered an Annexe in Mortgaging?
Much of the time, you might see a property advertised with a 'granny annex'. This refers to the popular setup of buying a home with separate accommodation for an older family member to live in.
This arrangement means that a parent or grandparent has a family on hand to look out for them, but that they also have their own private space.
In most cases, it is more affordable to purchase a property with an annexe than consider residential supported living or a care home or even consider a standard residential mortgage on your existing property.
Buying a home that meets all your needs can be tricky, especially if you're looking for something unique like an annex house. An annex offers additional living space, often with its own entrance and facilities, all under the same roof or on the same property. They come with a variety of options like having a ground floor, a separate shower room and more.
Our blog explores how mortgage lending on homes with annexes can simplify finding a place that brings generations together or adds extra income. Discover tips to make your search easier—read on!
What is an Annexe and its Benefits?
An annexe is a separate living space either attached to or located on the same property as a main house. It offers extra sitting room for families, helps save money, and can even be rented out to bring in more income.
Brings multi-generational families together
Buying a home with an annex can turn the dream of living closely with family into reality. It offers young adult children or elderly relatives or elderly parents their own space while keeping them close to the family unit.
This arrangement fosters stronger bonds among family members across generations, promoting shared experiences and mutual support.
Mortgage on homes with annex also caters to the need for privacy within multi-generational families, allowing each generation its independence. The set-up provides a unique blend of proximity and personal space, enabling loved ones to be together without compromising on individual freedom or comfort. Also, if you want the benefits of an annexe without buying a new home, you can build an annexe in your garden but you will have to obtain planning permission first.
Saves money
Owning a home with an annexe can lead to significant cost savings for families. With the extra space an annexe provides, multi-generational living becomes more practical and affordable.
Families can share expenses like utilities, maintenance, and mortgage payments on the existing house, reducing the financial burden on each individual. This arrangement strengthens family bonds and makes economic sense in today's challenging financial climate.
The addition of an annexe increases the total square footage of a property, potentially boosting its market value. Homeowners might find this beneficial if they decide to sell in the future.
Moreover, having an annex offers flexibility; it can serve as a guest house, rental unit, or even a home office. This versatility adds to the property's appeal and functionality while ensuring homeowners get the most out of their investment and also earn some potential rental income on your main property.
Amongts the many benefits of having an annexe in a property, there's the fact that it adds value to your home and you can benefit from a multiple dwelling relief as well.
Provides a source of income
Renting out an annexe turns it into a valuable source of income. Homeowners with annex houses can charge rent, which helps cover their own mortgage payments or adds extra money to their monthly budget.
This setup is particularly appealing because it allows landlords to earn from space that might otherwise sit unused.
Landlords must keep the annexe in good repair, ensuring it meets safety and fire regulations before they start renting it out. This responsibility means staying on top of maintenance issues and making any necessary repairs quickly to keep tenants safe and satisfied.
By doing so, owners comply with the law and make their mortgage annex house more attractive to potential renters, securing a steady flow of income over time.
How to Find Homes with Annexes for Sale
Finding homes with annexes for sale starts with a simple search in your local area. You can refine your hunt by applying filters specifically for Granny Annexes or properties with converted outbuildings.
Search for properties in your area
Start your search for properties in your local area by visiting real estate websites and checking their listings regularly. Many sites offer alert systems that notify you when new homes matching your criteria, including those with annexes, hit the market.
Local estate agents can also be a valuable resource. They have extensive knowledge of available properties and may know of homes with annexes before they are listed online. Contacting them directly can give you early access to potential homes in your desired location.
Use filters to find Granny Annexes
After identifying potential areas, using filters effectively can narrow down your search to homes with annexes. Real estate websites and apps offer a variety of filter options that allow you to specify the type of property you're looking for, including those with granny annexes or additional living spaces.
Look for converted outbuildings or attached annexes
Searching for homes with converted outbuildings or attached annexes can open up unique opportunities. These structures often serve as perfect granny annexes, home offices, or guest houses.
They add valuable living space without the need to construct new buildings from scratch. Buyers should focus on properties that showcase these adaptations, like The Big House in Hook, Wales, which boasts spacious accommodations alongside the River Cleddau.
Finding a property with an already converted annexe means you can enjoy additional space immediately without undergoing construction work yourself. For instance, consider a traditional farmhouse near Penzance, Cornwall, listed by Stacey Mann Estates or a charming thatched cottage in Exeter, Devon available through Knight Frank.
These examples highlight how annexes enhance properties by offering separate living quarters within beautiful settings.
