Just wanted to get some opinions on getting a buy to let duplex apartment above an A3 premises which is currently a Costa Coffee. My fear is that if a restaurant replaced it at some point in the future, would this impact future value and also the ability to rent it out? Should the value be less than a regular leasehold? Thoughts?
Yes. Use class of A3 may put off some lenders. If you are above petrol, betting or restaurants you're higher risk. A1 is better if you have to be above shops. Also chances are the Costa is a franchise. If it's the Costa closest to me and you that is a franchise and if it ever closes will no doubt be another curry house.Originally Posted by langdalematt
While the coffee smell will be acceptable, a restaurant smell might not be
Lenders will lend but the LTV will be restricted depending on where it is. Usually valuers will take that into consideration when calculating the value. Try to make sure it has a long lease otherwise you have a depreciating lease that will be costly in years to come.
It’s a 999 year lease. Just worried about future value
Future value will always be lower than other flats not above commercial. A1 is better than A3 by some distance. It's going to be cheaper now compared to other flats and that will be the case when you sell. Have to think about if you want the yield or of you want the future value.
Any property where there could be a nearby change in the future, could in turn have its future value and desirability affected. As an owner it would be out of your control. Therefore if you have concerns, which I’m guessing you do based on this post, you either walk away now as it’s not worth the risk, or you make an offer based on your future concerns.
I live in what I’d describe as a desirable village. I stretched myself financially in 2000 and bought a lovely home here - 5 beds, lovely secluded garden and fantastic uninterrupted views over the countryside for about half a mile which gives me a glimpse of the sea in the distance. I knew when I bought, that the field in front of me had planning permission turned down 3 months before. I Really wanted the house and after long deliberation I bought it at what I thought was a fair price and reflective of the view I could lose. I didn’t and have loved every minute here. Last year they put in again but this time the council ‘called it in’ as they said the infrastructure of the village was unsuitable which was lucky. If they had got it I reckon I could have knocked 100k off the value. The deal I got at the time was one I was happy with should it ever have happened - unless this is a good deal for you, don’t take the risk. That would be my view. Future stress is never worth it.
Posting Permissions
Reply With Quote