Bridging lender, SDKA has increased its Semi-Commercial LTV to 75% to meet increasing demand from developers turning semi-commercial properties into residential residences to take advantage of the non-residential Stamp Duty Land Tax (SDLT) rates.
Under current SDLT thresholds a residential property purchased for £200k would incur an £11.5K payment, whereas a semi-commercial building would result in just a £1k fee.
The figures at £500k would be £40k and £14.5k respectively, a difference of £25,500.
Once acquired, developers are using permitted development rights to convert the commercial element to residential, which has the potential to increase income streams from the same asset.
The current SDLT rules were introduced on April 1, 2025.
Scot Tsang, Head of Operations and In-House Legal at SDKA, said: “The numbers are compelling to developers as SDLT savings can go a long way to, if not cover all, the associated costs of converting a semi-commercial asset into a fully residential offering which can increase income streams and asset value.
“By enhancing our lending criteria for semi-commercial properties to 75% LTV, an increase of 5%, we are ultimately providing greater flexibility and higher lending potential for every property professional and making semi-commercial properties an even more attractive investment.”
SDKA is a bridging lender offering products on Residential, Semi-Commercial and Commercial properties across England, Scotland and Wales.
The lender offers interest rates from 0.85% pcm up to 75% LTV and terms up to 24 months. Its maximum loan size is £10m.
The business prides itself on considering all cases on an individual basis, and through its proven lending record and close long-term relationships with funding partners it has the option to complete cases outside of the standard criteria.
