A live or work unit is a type of property that has been validated by the planning authority as part live and part work. It could be a home, flat or maisonette. The region’s planning authority handles the complete planning process for a Live/Work Unit.  It is also important to note here that if you are using workspace entirely as a residential space, you may face some difficulties as you could breach planning regulations.

In most cases, we usually find that, when working out the plans for converting or building a property, the local authority will require a certain floor space to be dedicated to use by the occupier. After that, the remaining space is used for residential purposes. The main reason behind this is to motivate business owners who own smaller companies to relocate their company to a more convenient location. Live Work Units can be purchased by anyone from any background, including lawyers, doctors, nurses, teachers, engineers, plumbers, electricians, musicians, actors, writers, chefs, programmers, web designers, painters, carpenters, gardeners.

In some cases, it may not matter if an apartment building is considered live-work because they can designate a certain percentage of their floor space as live work, but they don’t define how much of the total square footage must be dedicated to working versus living.

Most lenders have different criteria in considering live/work unit as suitable security for a mortgage application. Some street lenders won’t consider live/work units, whereas others would consider this property type; however, they stipulate that a maximum of 20% of floor space is to be used for work purposes.

At NeedingAdvice.co.uk Ltd, we can help you with the most suitable mortgage deal as per your profile. Our mortgage brokers appreciate every situation and look at every enquiry on a case by case basis.

You can also check our other article on Mortgage on Studio Flats.

Post Topics – Mortgage on Live/Work Units

Mortgage on Live/Work Units

FAQs-Mortgage on Live/Work Units


Mortgage on Live/Work Units

As we have discussed above, there are different lenders with various lending criteria for Mortgages on Live/Work Units.The best way to get a mortgage on Live/Work Unit is to approach a lender directly. However, if you want to know what kind of loan terms are available on such properties then you need to go through the following steps:

1) Find out which lenders offer mortgages on Live/Work Units .

2) Determine the criteria for such loans

3) Check whether your property meets those criteria.

4) Apply for a mortgage on Live/work Units.

5) Get a quote from the lender.

6) Negotiate with them to get the best possible deal.

7) Once you have agreed to the terms, apply for the loan.

8) Pay off the loan once all conditions are met.

9) Enjoy your new property!

 Read about our article on Mortgage on High Rise Flats.


FAQs-Mortgage on Live/Work Units

What is a live-work unit?

Live/work units are properties where part of the premises is designated for commercial use while the rest is used for residential purposes. In many cases, the local authority requires a certain amount of space to be dedicated to commercial use. This is usually done to encourage businesses to move into areas that are less congested.


Who can buy a live/work unit?

Anyone can purchase a live/work unit provided they meet the minimum income requirements set by the lender. These include:

• Income from employment

• Self-employed income

• Pension income

• Investment income

• Other sources such as rental income etc.


How do I determine my monthly repayments?

Once you have found a lender willing to lend you money, you should start looking for a property that fits your needs. You should take into account things like:

• Location

• Size

• Features

• Price

• Loan term

• Repayment period

• Interest rate

• Down payment required• Guarantor

• Prepayment charges

• Stamp duty


Are live/workspaces only found in ex-industrial buildings?

No, live/work units are available in any type of property including apartments, townhouses, terraced houses or detached homes. They can even be found in high rise buildings.


Can I finance a live/work unit without having to pay stamp duty?

Yes, you can. If you are buying a property that has been converted for another purpose, you will not have to pay stamp duty. The same applies when purchasing a property that was previously owned by someone else.


Do I need a guarantor for a mortgage on a live/work unit?

If you are borrowing more than 80% of the value of the property, you may require a guarantor. This means that you must provide proof of financial responsibility before the bank gives you approval. Your guarantor would be responsible for paying back the loan if you default.


Is it difficult to find a property that fits my needs?

It’s always easier to find a property that suits your needs rather than trying to fit one that suits your budget. That being said, you should make sure that the property you choose is within your reach and that you can afford the repayments.


Will COVID cause growth in live/work properties?

We expect this market to grow during the current crisis. Many people are now working from home and are therefore able to work longer hours which increases their disposable income. As a result, we expect demand for live/work properties to increase.


What is the difference between a mortgage on a house and a mortgage on a live-work unit?

A mortgage on a house is secured against the whole property whereas a mortgage on an LLU is secured against just the portion that is used commerciallyTherefore, a mortgage on a live work unit is cheaper than a mortgage on a house. However, there are some downsides to a mortgage on a live /work unit. For example, you cannot sell the commercial part of the property without first selling the whole property. Also, the interest rates on mortgages on live /work units are higher compared to mortgages on houses.


Are there any businesses you can’t operate from a live/workspace?

You can run any business from a live/work unit. However, certain types of businesses are better suited to a house. Examples include:

• Retail stores

• Restaurants

• Bars

• Hotels

• Hair salons

• Beauty salons

• Medical clinics

• Banks

• Insurance companies

• Financial services companies