Bless this house: if you fancy something different, it's a heaven-sent opportunity

Unusual homes are in favour with buyers and mortgage lenders, writes Sam Dunn
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The Independent Online

For sale: spacious period properties offering opportunities for conversion to character homes. Each boasts original architectural features throughout, and is set in its own grounds.

Interested? Then you might want to consider making an offer for one of the 13 churches currently up for sale in the UK.

While it is not always practical to convert a house of worship for residential use, an increasing number of people are setting up home in former churches such as Eppleton All Saints, in the diocese of Durham, which has just been sold to a property developer. Although the sale price is undisclosed, Smiths Gore, the estate agent that handled the sale, confirms it fetched at least the guide price of £40,000.

This may sound cheap when the latest figures from the Halifax show that the average UK house price is now £151,467, but there will be extensive renovation costs to take into account.

If you like the idea of living in an unconventional structure, log on to property.org.uk/unique, a website listing anything from barns to stately homes. It currently features a Second World War observation post in Bawdsey, Suffolk (a steal at £125,000) with planning consent for conversion into a holiday home. Scroll down the list and up pops a large hexagonal house in the South Downs (on at £495,000).

Rightmove.co.uk, another property website, also has a section that lets you hunt for unique buildings within a chosen geographical area.

"People are becoming more and more innovative about where they buy and what they consider looking at," says Paul Fincham, a spokesman for the Halifax. "It used to be very difficult to get a mortgage on unusual properties because few people had done so before, but these days lenders have a better understanding of the risk and are more prepared to lend.

"Over the past 15 years, mill conversions, for example, have taken off. And property programmes on television have given people creative ideas."

If you have long fancied living in a former fire station or a lighthouse, you might be surprised at how easy it can be to find a suitable home loan to turn your dreams into reality.

"You can get a loan on nearly any property; we will judge everything on its merits," says Anna Guthrie, spokeswoman for Norwich and Peterborough (N&P) building society.

David Hollingworth at the mortgage broker London & Country says that it's all about "saleability". So long as the converted property can easily be sold on, it shouldn't be difficult to find a mortgage provider to lend on it.

N&P's Ms Guthrie warns anyone planning to convert or renovate a home to add an extra 15 to 20 per cent to their original budget estimate to cover delays and disasters.

Before you can get a conversion or renovation mortgage, you will need to have done the following groundwork.

* Secured outline planning permission.

* Consulted with the local council's buildings regulations officer to ensure you are not in breach of existing planning restrictions.

* Commissioned a report from a structural engineer, as well as detailed architectural plans.

If everything is in order, the loan will usually be released to you in stages. For example, imagine an old village school on sale for £150,000 needing another £50,000 to convert. If you had a 10 per cent deposit, you would borrow £180,000. A typical conversion mortgage would lend you between 85 and 90 per cent of the sale price to buy the property (say £130,000). After that, you would receive £25,000 (half of the outstanding balance of the loan) to pay for architect's fees and structural alterations. Once this stage of the work was approved, the remaining money would be released for plumbing, rewiring and other work to make the building habitable.

The best such mortgage on offer from N&P is a two-year fix at a discounted 3.24 per cent, after which it reverts to the 5.99 per cent standard variable rate.

Other lenders offering similar mortgages include Alliance & Leicester and the Ecology building society, but it is best to use a mortgage broker to find the deal most suited to your individual circumstances.

Conversions and renovations can take months to complete, and you will need somewhere to stay during this time and enough money to live on. You may be able to arrange with your lender to carry on living in your current home while the work is done.

If you find an unusual house that has already been converted, you shouldn't expect any difficulty at all in getting a mortgage, says Mr Fincham at the Halifax. But watch out if your dream is to live on a boat. Most lenders are unwilling to finance any home that is not deemed a fixed structure by their own insurers. To get a mortgage on a boat, you will need a specialist company such as Barclays Marine Finance - and expect the interest rate on your loan to edge towards double figures.

ALTAR-ED STATE

"It's a lifestyle decision," says Jacqueline Gallacher, "and it's definitely not for everybody."

All Saints church in Haywood, near Doncaster, has been home to Jacqueline and her husband Ben for nearly four years.

Since the previous owner had already converted the building, they had no trouble raising the required £225,000 mortgage with the Halifax.

"It's very peaceful, very different and not at all oppressive," Jacqueline enthuses. "You don't often get the chance to live in a place like this."

The living accommodation has an open-plan layout, with the main area connected by stairs to an upper gallery. Architectural features include the original roof beams and arches, together with huge windows designed in the Gothic style.

The 2.5ft-thick walls and underfloor heating keep the property well insulated; outside, the former graveyard is now the Gallachers' garden.

"It's a very homely place to live," Jacqueline adds. "We even have Sky TV."

While they have no regrets about buying such an unusual home, she and her husband are now planning to move. They hope to sell for around £445,000.

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