A new service from Buildsafe saving you considerable costs when taking out building warranties.
This new service is for property developers who are building residential units that are going to be rented instead of sold at completion. Usually you have to pay the insurance provider for membership, technical audits, insurance premium and Insurance Premium Tax (IPT) upon inception.
It happens all the time you see a great site prime for development, you figure you have enough for a deposit but need to raise finance for the rest of the acquisition and construction costs. By the time you have spoken to the bank or tried to raise finance from a HNWI the agent calls to tell you the site has been sold. We assist in this position all the time, the only way to secure the right opportunity at the right time is with a fast flexible approach to finance and insurance. We work very closely with principle lenders and small private funds to offer great loans at competitive rates.
Do I need a Professional Consultants Certificate or a Building Warranty?
If you are developing a property and are intending to sell it, rent it or refinance it you will need a Professional Consultants Certificate (PCC) or a Building warranty.
Mortgage Lenders will only lend on a property if it is covered by an approved warranty policy or a Council of Mortgage Lenders (CML) Professional Consultants Certificate (PCC).
Building warranties are insurance policies that provide the residential home or commercial building with a 10 year structural latent defects guarantee in the event of building damage or failure due to build & design inefficiencies.
Some Developers have recently made the common mistake of thinking that there is no building warranty requirement for refurbishments or conversion projects only for new build. In fact, lenders now insist on a warranty being in place for any conversion or refurbishment where structural work is taking place. It has also been known for lenders to refuse finance even on a conversion where no structural work has taken place.
It is often the case that building works defects may not become evident until after completion of the project and then well after completion of the defects liability period. These faults are known as latent defects. Latent defect insurance provides cover for damage as a result of defective design, workmanship or materials, not discovered before practical completion. The policy period is usually 10 years and can be extended to include; Loss of Rent, Component cover and Mechanical & Engineering damage.
Traditionally the market for development finance has been dominated by major banks. With the likes of Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland having a combined share of 85% of the development finance market, there was little appetite for developers to look elsewhere for funding. However, in recent years the preference for tailored customer service and high customer satisfaction has increasingly become a deciding factor in the choice of development lender.
The latest happenings in the UK Building Warranty market
If you are a property developer or builder, you know the importance of obtaining the right Building Warranty.
As the leading independent provider of building warranties in the market we are happy to publish the latest updates so you can ensure you are fully informed.
It is a fact that circumstances change in the world of property development.
As an example, you build a house or block of apartments that you are going to rent for the long term, because you don’t expect to sell the asset you decide not to purchase a building warranty.
However, a few months after practical completion of the build an opportunity arises to purchase another asset prime for redevelopment so you decide to sell the original property.