Full steam ahead!

I got a call back from the area rep last Tuesday saying she could come up and visit today, so the last week has been a flurry of decluttering and cleaning!  I will come clean at this point and say that the house we are trying to get the holiday let mortgage on is the one we currently live in – our existing residential mortgage will port to the house we want to buy, but we need to raise the money to pay for it against this house as Ethel’s won’t be mortgageable until the title is created.  So the visit was to assess not only Ethel’s but also our house, which is a 3-bed croft house, the same as Ethel’s, but with a separate 1-bed annexe.

I will confess, I was nervous.  The house is not currently up to standard for holiday letting, we’ve been concentrating on putting money into outbuildings, fields and fencing, so we still have the carpet and in some case the decor of the previous owner, who’d not lived here for two years before we bought it nine years ago.  But I was able to walk through the house and explain exactly what we’d do in each room, and a couple of rooms we have done over, like the dining room and the bathroom, so she could see what our idea of a finished room was like.  Then we went down the road to Ethel’s, where she exclaimed over the views and approved of all our plans for down there as well.

We had some lunch and she went through how their pricing and booking system works and I was able to pick her brains about all sorts of useful things (note to self: turn the annexe bathroom into a wet room, buy leather sofas rather than loose covers for ease of cleaning if we’re going to accept dogs, which we will).  Then it came to the crunch time – what rental estimation would I get?  The magic number we needed on our house and the annexe was £9,600 between them, after the agency fees.

‘Remember, these are conservative estimates,’ she warned me, as she took three computer printouts from her clipboard.  ‘They’re based on the location of the properties, what we get for similar properties in the area, and it’s based on a mix of high, mid and low-season weeks.  I’ve based it on 25-27 weeks a year, but we’re achieving 35-40 in this area at the moment, thanks to the North Coast 500.  I’ve done them based on you getting a 4* Visit Scotland rating, which from the sound of everything you’ve told me, you will.’

So what were the scores on the doors?  After agency fees and VAT, it came out as follows:

  • One-bed annexe – £8,893 a year
  • Our house – £11,967 a year
  • Ethel’s house – £13,344 a year

!!!!!!!!!!!!!!!!!!!!!!!!!!!!  I nearly fell off my chair!!  More than double what we needed on our home to go ahead!  So now it’s full steam ahead with the mortgage application for the holiday let mortgage and getting approval to port our mortgage to the new house, and back to the plastering so we can get Ethel’s up for rent ASAP and then start work on home.

Just to put the cherry on the Bakewell, I had an email from a journalist client this morning asking if I could transcribe an interview for her this afternoon so she could get it written up and filed overnight.  I emailed back to say I couldn’t start until around 3pm and explained why.  She wished me luck, so I told her how it went when I returned her file this evening.  She’s offered to pitch a piece on the area to a national newspaper she writes for regularly and mention the houses in it when we’re up and running, which would be absolutely amazing publicity.  I am feeling very, very lucky tonight.

Under starter’s orders

My father used to say that buying a house was like the Grand National in terms of how many fences one had to jump to reach the finish line.  It appears that we only have three in our personal Grand National, but they’re all pretty much Becher’s Brook-sized.

Those of you going, ‘Eh?  What?  Buying a house??’ haven’t missed anything – this time last week we weren’t even considering buying a house, but then an opportunity came up that we knew we would absolutely kick ourselves for missing out on if we didn’t try and take it, and so after a telephone call with my mortgage broker this morning to clarify some points on both sides, we are going for it.

More details of the house once it’s sewn up, but our three fences are:

  1. Can we raise £127,000 on a buy-to-let mortgage?
  2. Can we get a market rental valuation of £650 a month?
  3. Can we borrow back the mortgage reserve on our current mortgage?

I spoke to our lenders this morning as well, and the answer to 3 seems to be a cautious yes.  They’re closed to new business, so need to double-check with the higher-ups that it can be released and also the full amount will need to be within the original lending criteria in terms of LTV, although we should be okay on the latter point – we’re currently under 60% LTV.

So watch this space and please cross your fingers!

Going back to my father – he would have been 84 yesterday, so he was on my mind, and with the Grand National being run last Saturday, I was thinking about a letter he wrote me when I was at university and he and Mum had put in an offer on a beautiful Grade II-listed house in Somerset, with the plan of my grandmother going to live with them there as well.  It only took me a few minutes to find it, despite the current state of my office (it still has an entire Howdens kitchen crammed into it!), and I realised from the date that it was the last letter he ever wrote to me before he died – he was in a serious car accident seven days later.  So in a post about my Grand National fences, here are Dad’s, from 23 years ago, together with the fountain pen he used to write them which I still use every day.