Thinking of buying a flat above a shop? You’re not alone. Such properties are traditionally lower in price and central to town, making them a good choice for first-time buyers, young professionals, and property investors. But there is one nagging query: Can you obtain a mortgage on a flat above a shop? Let’s cut through the myth and examine the reality of buying a house above a shop in 2025.
The Myth: You Can’t Get a Mortgage on Flats Above Shops
There is a very common myth that mortgage lenders simply won’t lend on flats above shops. While it is true that some lenders are more cautious, the reality is you can get a mortgage, but you have to understand what affects eligibility.
The Reality: It’s Possible, With the Right Lender and Advice
High street banks and specialist lenders will lend on flats above shops, restaurants, takeaways, or other commercial properties. They price these buildings with an extra level of conservatism because of the potential exposure to noise, odors, security threats, or resale challenges in the future.
What Lenders Look At
To determine whether they’ll lend on a flat above a commercial building, lenders typically consider:
1. Type of Commercial Business Below
Lower risk: Offices, salons, or boutiques.
More risky: Restaurants, pubs, late-night, or takeaways (due to noise, smells, or passing trade).
2. Accessibility
Lenders also prefer flats with independent and private entry (not through the shop below).
3. Lease Terms
It is important how long the lease is, most lenders require at least 85 years left, preferably more.
4. Construction Type
Non-standard construction (e.g., above converted shops or older houses) can limit lender options.
5. Resale Potential
Lenders prefer to have confidence that the property will be saleable in the future, particularly in case repossession is ever needed.
How Does This Affect Your Mortgage Options?
You’ll not have access to the entire market of mortgage products, and interest rates might be a little higher depending on the amount of risk the lender views you as taking. That’s why going through an independent mortgage broker like Oportfolio Mortgages is most important, we can mortgage shop the entire market, including specialist lenders found nowhere else on the high street.
What You’ll Need to Provide
If you’re applying for a mortgage on a flat above a shop, make sure you’re ready to share:
- A detailed valuation report
- Full lease documentation
- Proof of private access
- Details of the commercial business below
First-Time Buyer Tip:
If you are purchasing for the first time, do not be deterred by myths. These flats often represent fantastic value, especially on areas like Putney, Wandsworth, or Fulham. If you have a good income and reasonable deposit, your perfect home might just be above your favourite café!
Key Takeaways
- You can mortgage a flat over a shop, with proper advice.
- It is the sort of business beneath the flat that counts.
- Private access, term of the lease, and type of construction are important factors.
- Specialist lenders can be more flexible than banks on the high street.
- Use a mortgage adviser to increase your chances of acceptance.
Our Advice: Speak to a Specialist Early
Here at Oportfolio Mortgages, we set up mortgages for all types of non-standard properties on a daily basis. We’ll take you through the options, speak with lenders, and make sure that you’re aware of what’s going on every step of the way. Ready to Find Out About Your Mortgage Options? Call Oportfolio Mortgages today for a complimentary consultation. We will advise on whether you’ll be accepted, establish your affordability, and determine the right lender to fit your specific case. We are here to help!
