Mortgages for Property Development

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As your mortgage is such an important transaction, good advice is imperative.

Get top mortgages for property development

In the event that you are looking to build new properties on a piece of land or are hoping to make extensive redesigns to existing properties – for instance, modifying non-residential properties into a range of private homes – then you are liable to need the services of an expert property development mortgage lender.

Property development mortgages are intended for individuals who are adding to a portfolio of properties with the intention of making them available to be purchased or to rent out once the development is completed. People who plan to construct or redesign an individual property for their own use or to sell on can often finance their work by using a bridging loan or a self build mortgage.

A specialist mortgage advisor will have the expertise to help you choose which type of property development finance deal is most fitting for your circumstances.

What will I have to consider when picking a mortgage for property development?

There are several ways in which you can fund your building or renovation ventures and the most suitable option for you will depend on several aspects, some of which could include:

• Your level of experience in the field of property development – if you can demonstrate a good track record of following through with renovation projects and successfully letting or selling them on, this will go a long way to reassure potential mortgage lenders.

• Whether the property or properties are in a liveable state at the time the mortgage is arranged – a habitable property is typically characterised as a property that has functioning facilities such as power and plumbing-in water supply, and which can be secured from the outside against the elements and to prevent intruders.

• Whether the property is being changed over from one function to another – for instance, a derelict factory building that is being made into executive apartments.

• Whether you own the land required for development or are yet to purchase it – some property development mortgage brokers will offer you an advance to support the buying of the area you require and then provide the remainder of the mortgage money to fund the development itself.

What will mortgage lenders consider when deciding whether to offer mortgages for property development?

Fundamentally, every mortgage provider needs to be assured that they will recover their cash if there is the need to sell the property later on.

Mortgages for property development are more financially hazardous to mortgage lenders than a standard mortgage for clear reasons – as opposed to requesting that the mortgage supplier lend to you based on the value of a current property, they are being requested to lend to you based on the estimated potential value of a property that either is not yet in a resalable state or has not yet been built.

In light of this, mortgage providers for property development are liable to consider the criteria below before they consent to a property development mortgages:

• Some mortgages for property development will oblige you to have a fund of around 30% to 40% of the general budget plan for the development. In the event that you are an experienced property developer with an established track record of successful development and a substantial portfolio, some mortgage suppliers may be willing to offer high sums of money on more flexible lending terms.

• The intended use of the property – the decision to lend may be contingent upon whether you are looking to finance the development of residential or commercial properties. In addition, many property developers nowadays want to create properties for mixed use – for instance, they want to create a building that offers both commercial and residential spaces. 

Our independent whole of market mortgage team can help you to locate the right property development mortgage deal for you – call us today on 0117 403 4474 or To speak to one of our mortgage advisers click here »