Implications of breaking the chain

[areyouhavingagiraffe]

Hi all,
Three of us in chain; FTB (buying my place), then me, then my Vendors (who are leaving the UK; their move is not dependent on their Sale). Anyway, long story short, but there is a loft room (my Purchase), with no Building Regs. I knew it was not marketed as a bedroom, and the EA was clear about that. What I didn't realise is that as soon as you make structural changes to the loft you need Building Regs, regardless of whether you tell people it is for storage. It has a fixed staircase, walls, heating, windows etc, however they are stating it is "storage" only. I am asking for a Regularisation Cert. I know this is a belt and braces approach, but I cannot take any risks, particularly as I knnow it could invalidate my house insurance if something happened up there (fire etc).
Anyway, my question is what are the implications of me breaking the chain? Technically I am the only person in the chain. I am thinking I will continue with my Sale (fingers crossed and praying to all of the Gods). Happy to continue with Purchase (albeit delayed, if the Vendors can get the paperwork), but this becomes independent to my Sale. I can move in with my folks for a while (they are not far, and it is just me so no major inconvenience). Any other stuff I should be aware of?

We have broken our chain and moved into rental. I suppose just the risk that the house you’re buying doesn’t work out for some reason. How long can you stay with family? Is the house you’re buying quite unique or could you find similar again for the same price? You’ll be in a good position as a buyer but you are taking on some uncertainty. It sounds like a good option in your case.

What if the loft needs costly works to produce a regularisation certificate would you still want to buy it?

@pilates - if it needs work then it is not up to scratch at the moment. Everyone (Vendor, EA) keeps telling me all it needs is a fire door, and it's all good. In which case, put in the fire door and get the Certificate. No problems, we are good to go.

@IndecisiveBuyer2021, I can stay with folks for as long as I need to. They have been so great and supportive and I am very close to them. They have a huge house, so no major issues there. I am just gutted really, but I am nervous about buying a property where there is unauthorised work in the loft.

Very similar situation to our really except we don’t have family nearby to stay with! Some works needed to the house we’re buying and if they can’t be done satisfactorily we will walk away. We also offered to reduce the price and look after those works ourselves but our seller prefers to sort it out themselves.

@IndecisiveBuyer2021....My Sale has been a ball ache, and I just want to focus on that at the moment. And I feel a little like I don't want to invest in a property which is going to be difficult for me to sell. My conveyancer has been useless and said "no point asking for a Cert, they won't have it, just tell us what you want to do. If you want we can raise it with the Lender, and they may withdraw mortgage, but it's up to you". WTF

If you’re sure you want to move, go ahead with your sale and start looking at other options too?

No, the risk is just that it takes longer to buy a new place than you expect so youre stuck living with your parents and house prices could rise (but equally may fall).

I think your conveyancer is being realistic in that they're not likely to get a certificate. They've been clear in marketing that it didn't have building regs and your offer needs to reflect that. How does the price compare to other houses? I'd be suspicious that it just needs a fire door, if that was the case they'd have got it signed off already.

Yes the biggest risk is your current purchase falls through, you're off the ladder and prices continue to rise. Largest risk is you get completely priced out of market for what you want based on budget you have..

I am paying top of range in the area, for a 3 bedroom property. However it could cost £50K to put the illegal conversion right. Ultimately it doesn't matter if you say you use the room for storage, the fact is there have been major works undertaken with no sign off from anyone. The fact that the conveyancer is saying it is up to me whether I report to Lender, and Lender will likely withdraw, tells me how much of a risk it is. Furthermore, the marketing says 3 bedroom plus loft room, it should say loft room without building regs for structural works. I agree @hgaj, if it was that easy to get it signed off, why has no one done it.

Can you get an indemnity policy for it?

Nope. If it is Habitable, you cannot get Indemnity. And the Indemnity only protects against Council enforcing you to take it down because of land of Building Regs.....doesn't protect me if the roof collapses, or if I want to put in a legit loft conversion the extra it will cost me. A builder told that 90% of these illegal loft conversions cost more to put right, then if you started from scratch in the first place. Also the Indemnity does not protect me if there was a fire, my house insurance would be null and void. Also, it could impact when I want to sell in the future.

I guess I am not walking away, I am asking for a Certificate, happy to wait around at my folks whilst they get the necessary paperwork. I just don't want to get my fingers burnt with this.

when did they do this - if it was before 1985 (I think) they didn't require one

@mumwon....no one knows. I have found a historic rightmove listing from 9 yrs ago which shows the room. The current vendors haven't done the work.....but no one knows who has, and when they did it.....

@mumwon, I reckon it was after 1985, the window looks pretty modern to me

For those that have "broken the chain", understanding the risks around property priecs rising etc, but also thinking of the pros (I will be chain free with a very large deposit), does is impact getting a mortgage? My solicitor said your mortgage is only for this property and you may not get a mortgage in the future.....I did have a mortgage AIP before I started house hunting. But surely this is a low risk. I mean, I could lose my job, become seriously ill etc etc etc. But surely, not getting a mortgage in future is not a reason to proceed now? Surely loads of people have gone into rentals after chain breaking, does not mean they will never get a mortgage.

Our AIP is in place until November and our broker had no concerns about us breaking our chain.

If you plan to buy soon breaking the chain just means you are in a better position as you will have sold your property. As long as your job/financial situation doesn't change you should get a mortgage again.
As for the house you are currently buying, if used for storage then they don't have to meet building regs- a ladder would have suffised. They are under no obligation to you, nor have they done anything wrong. Asking fur a regularisation certificate as a habitable isn't going to happen.
You buy the house in the full knowledge that should you wish to use that room as a bedroom you have to pay to make it meet current regs. This you should have realised from the start - I think their description was accurate and obvious that it doesn't have building regs.

@Livingintheclouds thanks, it doesn't matter whether or not it is used as a bedroom, whether you call it a storage room or a hobby room or whatever. As soon as you make structural changes in the loft, you need BR. A loft which has its supports taken out, a fixed staircase, a window, plastered wall, and a window require BR for those works. Naively, and totally my fault, but I didn't look into BR until this weekend. I assumed the EA telling me, it's not called a bedroom because all it needs is a "fire door and landing", was correct. I understand there is no obligation for them to provide. We have asked the question, ball is in their court

So op if they spend the 50 k quoting and get you BR paperwork your happy to up your offer to match this work getting it converted to a bedroom or wanting them to do it for nothing when they never sold it a s a 4 bed.

@Leigh8721, my offer is aleady £30K over their asking. Happy to increase it if they can get the Cert. Absolutely.

@areyouhavingagiraffe

Hi all, Three of us in chain; FTB (buying my place), then me, then my Vendors (who are leaving the UK; their move is not dependent on their Sale). Anyway, long story short, but there is a loft room (my Purchase), with no Building Regs. I knew it was not marketed as a bedroom, and the EA was clear about that. What I didn't realise is that as soon as you make structural changes to the loft you need Building Regs, regardless of whether you tell people it is for storage. It has a fixed staircase, walls, heating, windows etc, however they are stating it is "storage" only. I am asking for a Regularisation Cert. I know this is a belt and braces approach, but I cannot take any risks, particularly as I knnow it could invalidate my house insurance if something happened up there (fire etc). Anyway, my question is what are the implications of me breaking the chain? Technically I am the only person in the chain. I am thinking I will continue with my Sale (fingers crossed and praying to all of the Gods). Happy to continue with Purchase (albeit delayed, if the Vendors can get the paperwork), but this becomes independent to my Sale. I can move in with my folks for a while (they are not far, and it is just me so no major inconvenience). Any other stuff I should be aware of?

Have you sought legal advice? There are distinct differences between ‘liveable space’ and ‘storage’ especially for older work. DP bought a house recently where the loft room was marketed as storage only and nothing else was required because the work happened too long ago.

@Ozanj, yes my Conveyancer is saying that we need to raise it with the Vendors Solicitors (which we have). It also may need to be reported to Lender, and will have insurance implications. Obviously the Lender has visited the property and they make the assumption that all paperwork is in place. The Conveyancer also state in their paperwork to me, that if something in the vendors responses doesn't sound right, it is up to me to flag to the Conveyancers, since my Conveyancer does not visit the property

We never used Conveyancers just solicitors so some of this doesn’t sound right. Surely it’s up to them to be reviewing responses to questions / paperwork & flag it to you, not the other way around? Have they even checked how far back local building regs records go back?

@Ozanj, yes they have done a local search. I have seen this, no BR have ever been obtained. By conveyancers, I mean conveyancing solicitors (i.e property solicitors)

@Ozanj, yes up to them to flag, but also as a Buyer I have a right to raise Enquiries.....