Semi-Commercial Mortgages

Mixed-use properties require specialist lending knowledge. We understand the complexities of semi-commercial finance — from the 40% residential regulation threshold to multi-element income assessments — and source the right deal from our extensive lender panel.

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What is semi-commercial property?

Semi-commercial (or mixed-use) properties combine residential and commercial elements in a single building. They're common across the UK and can be excellent investments, but they require specialist finance knowledge.

Shop with flat above

The most common type. A retail unit at ground level with one or more residential flats on the upper floors.

Pub with living quarters

Licensed premises with a self-contained residential unit for the licensee or manager.

Office with residential

Commercial office space combined with residential units, either purpose-built or converted.

The 40% residential threshold

If 40% or more of the property (by floor area or value) is residential, the mortgage may fall under FCA residential regulation. This has important implications:

Below 40% residential

  • - Treated as commercial finance
  • - Wider lender choice
  • - Less regulatory burden
  • - Faster processing in some cases

40% or more residential

  • - May fall under FCA regulation
  • - Additional consumer protections
  • - More limited lender panel
  • - More thorough affordability assessment

Key details

Loan amounts £25,000 – £25 million+
Typical rates From under 4%
Loan-to-value Up to 75%
Terms Up to 25 years
Purposes Purchase, refinance, equity release

Frequently asked questions

What counts as semi-commercial?
A semi-commercial (or mixed-use) property contains both residential and commercial elements. Common examples include a shop with a flat above, a pub with living quarters, or an office building with a residential unit. The mix of uses affects how the property is assessed and regulated.
Does the 40% residential threshold matter?
Yes. If 40% or more of the property is residential, the mortgage may fall under FCA residential regulation, which provides additional consumer protections. Below 40% residential, the mortgage is treated as purely commercial. This threshold affects which lenders can offer the product and what assessments are required.
How are semi-commercial properties assessed?
Lenders assess both the commercial income (from the business tenant or your own business) and the residential income (from rental or imputed rental value). Some lenders assess the property as a whole, while others evaluate each element separately. We know which approach each lender takes and will match you accordingly.
Can I live in the residential part?
Yes. Many semi-commercial property owners live in the residential element and run their business from the commercial part. This can be a tax-efficient arrangement, and we'll source lenders who are comfortable with this setup.

Need semi-commercial finance?

Tell us about your property and we'll find the best funding solution for your situation.

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