28th March 2020
Development finance is a loan that’s used to fund residential developments, such as new-build construction projects or refurbishment schemes for converting property into flats, bedsits or HMOs. Whether you’re an experienced property developer, a landlord or you’re keen to kick-start your first new-build or renovation project, there’ll be a development finance route that suits your initiative.
Development finance is a form of short-term funding that will enable you to pay for your construction and development costs. It could mean a ‘refurbishment bridge’ that will fund a few months’ building costs of a light refurbishment project or the more substantial costs from covering your initial land investment outlay to completion of the final plot.
Your lender may agree to finance a proportion of the plot purchase and another percentage of the build – this way you would need to inject far less of your personal money, which would be freed up to cover the cost of other projects or unexpected expenses. When you have a property portfolio with a lot of equity, you can use your property to secure further lending – this could be invaluable when you have insufficient liquid cash to grow your portfolio.
Property development can be a challenging environment and weighing up your best and worst-case scenarios is a critical exercise when it comes to funding your project. Getting your finance right in good time will ensure your development activities can proceed and thrive – regardless of the economic climate.
To find out more about development finance for your next project, talk to our team of expert advisers and we’ll help you find a funding stream that will help you from the ground up. Call us on 08454 500200 or click here to make an enquiry.
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