Misled about floor area and now can’t sell?
My daughter is trying to sell her flat which she bought 3 years ago. The new agents have informed her that the floor area is 27sq m, and that it will not be possible for her to proceed to sell to another mortgage holder if it is below the threshold of 30 sq m, they further inform her that she should not have been given a mortgage on this basis.
The EPC states the floor area is 28 sq m, again below the threshold, she is now stuck with a flat she cannot sell except to a cash buyer for a price below market.
What action can she take to recoup any losses incurred given the mis-selling of the flat?
Many thanks
Graeme
Comments
Have Your Say
Every day, landlords who want to influence policy and share real-world experience add their voice here. Your perspective helps keep the debate balanced.
Not a member yet? Join In Seconds
Login with
Previous Article
Tenant only missed one month but needs Section 21?
Member Since February 2011 - Comments: 3453 - Articles: 286
11:59 AM, 1st July 2021, About 5 years ago
Hi Graeme,
Do you have a copy of the original mortgage valuation survey done for the lender? I am surprised this was not picked up at that stage, or did the lender have a lower criteria for minimum floor area? I have seen in the past 25 sq m minimums, but that was many years ago I was involved with BTL finance.
Member Since June 2021 - Comments: 2
12:18 PM, 1st July 2021, About 5 years ago
Yes, we have the valuation survey which states the floor area is 30 sq m, measured by ourselves yesterday we calculated it to be just over 27 sq m
Member Since February 2011 - Comments: 3453 - Articles: 286
1:58 PM, 1st July 2021, About 5 years ago
They may be some recourse with the surveyor in that case as an avenue of investigation.
Member Since March 2020 - Comments: 184
2:37 PM, 1st July 2021, About 5 years ago
I thought it was OK for a one bedroom flat to be below 30 square meters but not a studio flat. I am in that position with a flat bordering on that and I thought if push comes to shove I could put in a partition and make it into a one bedroom flat.
Member Since January 2020 - Comments: 134
11:20 AM, 2nd July 2021, About 5 years ago
Any chance that your morgage survey measurement was external, whilst selling agent and EPC measurements are internal?
Member Since April 2018 - Comments: 50
11:36 AM, 2nd July 2021, About 5 years ago
Following this thread as we have a small studio flat bought with a nat west btl mortgage 10 years ago and have recently tried to sell but have had two lenders turn it down how long has this 30sqm been in force ?
Member Since June 2021 - Comments: 2
12:07 PM, 2nd July 2021, About 5 years ago
Reply to the comment left by Ian Cognito at 02/07/2021 – 11:20
No it was an internal inspection
Member Since August 2016 - Comments: 1190
12:29 PM, 2nd July 2021, About 5 years ago
Reply to the comment left by Derek t at 02/07/2021 – 11:36I’m sure this minimum internal floor area issue is up to the individual mortgage lender. I’m sue the PRA haven’t regulated it…… yet ! Perhaps a mortgage broker can source a lender who’s happy to lend here ?
Member Since November 2017 - Comments: 261
12:53 PM, 2nd July 2021, About 5 years ago
Reply to the comment left by at 01/07/2021 – 14:37
I think the SqM for a one bedroom flat is now 37.
That’s assuming that the build regs will be taken as the guide by Mortgage companies, which appears to be what happened with studio’s.
Member Since November 2017 - Comments: 261
1:11 PM, 2nd July 2021, About 5 years ago
Well this came as an unpleasant wake up call today. After a deal of internet research and ringing up the professionals I believe the following is the current position. (those who know better feel free to correct me)
1). It’s not law/regulated yet, it’s the mortgage companies preference. There are about 4 companies that don’t apply the 30SqM barrier. As mentioned above they are more inclined if the area is good and properties sell fast.
2). If measurements taken / published / used were false then there is a legal comeback against those responsible, but good luck with that. Particularly if it was the surveyor as there is/was that 20% get out clause. (if something crops up that doesn’t effect the price by more than 20%….tough).
3). I’m still trying to bottom out the effects on the valuation for HMRC purposes where the property is reported as a company asset.
4). The likelihood of this becoming law/regulated is debatable as how would you apply it retrospectively to older stock, particularly purpose built.
Am I the only one who feels somewhat shafted through no fault of their own?