Buying, selling and letting - Tuesday, April 08, 2008

 

For many people every day begins with a commute to work, either by public transport or battling the traffic on the motorways. In fact, almost 1 million people commute into London alone every day.

 

Commuting has been in the spotlight in recent years because of the impact it has on the environment, with people encouraged to carpool and bike to keep carbon emissions down.

 

Now there is a new guilt-free way to commute. A commute that takes one minute, incurs no fares, petrol costs or congestion charge and has no impact on the environment. This is the daily reality for the growing number of 'green commuters' who are opting to work from home, without the distractions that working from home often comes with. They are working from their garden.  

 

Garden room specialist, Rooms Outdoor, says it has seen a steady increase in enquiries for its range of contemporary garden office rooms initially since the extension of the congestion charging zone and now with jitters in the housing market. Staying put and working from a bespoke office has become an even more attractive option. Added to this is also the environmental feel good factor - avoiding an average 10,000 annual travel-to-work car mileage, the green commuter is reducing his or her carbon footprint by 3.5 tonnes of CO2

Garden offices created by Rooms Outdoor buildings use a number of sustainable materials, as well as exceeding the required British housing standards of insulation. A carbon offsetting scheme is an optional extra for those wishing to avoid any environmental impact due to the construction of their new garden office.

Among those to have already made the switch is Annie Stevens, one of the UK's leading designers and chairperson of the British Interior Designers Association.  Annie recently installed a Rooms Outdoor Moderno and moved her highly successful interior design business from a London office back to her garden. The studio is large enough for two employees to work with her and also provides room for a meeting space. At the end of the day, thanks to clever storage, the area is transformed into a chill zone for her teenage children.

"While work-life balance has always been a factor for people choosing to work from home," says John Keenan, Managing Director of Rooms Outdoor, "We are seeing more people making the decision based on a range of problems associated with the housing market and commuting to work. This can simply be concern about the uncertainty of house prices, the frustration of travelling as well as an increasing number of people taking their impact on the environment very seriously."

He continues: "The choice of Rooms Outdoor designs means that garden offices can fit into even the smallest garden, are suitable for year round use and are extremely energy efficient and environmentally friendly."

Construction time on the Rooms Outdoor range is typically eight weeks from the first survey with planning permission only required in a minority of cases There is also minimal disruption to the home with all the work contained in the garden, meaning that the garden office can be prepared with almost no impact on the household or existing working arrangements.

John Keenan adds: "Adding a garden office is almost an instant solution to a better quality of working life and certainly compares very favourably when weighed against the average length of time it takes to buy and sell. In such uncertain times having this additional time to focus on your work could be vital to the success of your business."

For more information visit >www.roomsoutdoor.co.uk

 

Government figures show that 1.7 million of British households live in leasehold houses, flats and maisonettes. Leasehold is the term given to properties which confer only a right of occupation for a specified period of time. The right derives from a document called the Lease. Historically, upon expiry of the Lease, the asset would revert to the person who held the full title, called the Freeholder.

 

Historical Foreplay

 

It is not surprising that this two-tiered ownership structure has often resulted in serious disagreements regarding property management and maintenance charges. Especially given that until recently leaseholders had no control over how their property was managed and the costs involved.

 

Rachel, 42 of Norbury says “I lived in a leasehold flat about ten years ago. As soon as I discovered how pitiful my rights were when faced with a dispute over service charges, I voted with my feet and moved out”.

 

Legislative changes to leaseholder rights started to take place as early as 1954 although it was not until 2002 that the leaseholder’s ‘right to manage’ was introduced.

 

Updated Rights - Right to Manage (RTM)

 

Subject to certain conditions, Leaseholders can join forces to take over management of their property, irrespective of the wishes of the Freehold owner or current Managing Agents. Importantly, in many cases, this can be achieved without recourse to the Leasehold Valuation Tribunal (the court with jurisdiction over leasehold matters) and without accusations of fault or blame.

 

In order to qualify for this right, the general guidelines are as follows:-

 

• Two-thirds of the leaseholders in the building must have bought leases of 21 years or more.
• At least half of those who satisfy the above condition must be willing to exercise Right to Manage.
• No more than 25% of the total floor space in the building must be used for non-residential purposes (i.e. shop floor).
• The Freeholder must not be a local authority.
• The property must not be within the precincts of a church or chapel.
• If the Freeholder lives in the building containing four flats or less, and he or she lives there as his ‘only or principal home,’ Right to Manage cannot be exercised.

 

Maria (above) qualified for the right and persuaded the other leaseholders to join her in establishing a right to manage company and taking control.

 

“It seemed like a lot of work to start with”, she said “but I got legal assistance which helped a great deal. It went through like a dream”.

 

Some people are not quite as lucky as Maria. There are instances where the Freeholder refuses to accept Right to Manage and if he or she does not withdraw their opposition, an application to the Leasehold Valuation Tribunal may be the only alternative. Fortunately, however, the Tribunal can only prevent Right to Manage on the grounds of (1) ineligibility (2) outstanding service charges or (3) inaccurate procedure followed.

 

To conclude, Leaseholders should be encouraged to assume control as the grass is undoubtedly greener on the other side even though it might take a brisk walk to get there.

 

Written by Corinne Tuplin, Solicitor, of Pro-Leagle (http://www.proleagle.com/). 

Pro-Leagle is a specialist Leasehold and Property law firm.

 

 

 

(1) You’re kidding yourself if you think you are going to secure the home of your dreams purely by signing up with Rightmove.

(2) Make an effort to get to know your local estate agents and ensure they see you are a serious buyer by keeping in regular contact. Make the time to get in touch at least every couple of days to see if there is anything new on the market.

(3) Be realistic about what you can buy on your budget. Many home hunters waste months searching for the sort of property that will simply never come up in their price bracket.

(4) The more flexible you can be, the more chance you have of securing a great property. Think outside the box. Are you restricting the area too much? Does it really have to be Georgian? Could you consider converting a former commercial property?

(5) Don’t overlook a property purely because of its outside appearance. If a property is on a good road and has everything else going for it, it could still be a good buy. Consider employing the services of an exterior design company or architect to give an ugly property a facelift.

(6) Don't waste money on an expensive survey if the house is not that old. Tradespeople will often come and check electrics, plumbing, roof etc for free and at the same time, provide a quote for any repairs or maintenance, which can be a great lever for asking price negotiations.

(7) Get a great solicitor in place, who can use email, and is a pragmatic problem-solver.

(8) Get your broker sorted early so you know exactly what your budget is and make sure they can move fast when it comes to the time to get a mortgage in place.

(9) Be really nice to the vendors and estate agents - people sell to people they like.

(10) If you know you are going to be stretched for time, consider appointing a professional home finder.

Tips for SELLERS

(1) Make sure your house has kerb appeal by tending to your front garden and giving your front door a fresh coat of paint. If your property is not looking reasonably lovely on the outside, many potential buyers won’t even bother to walk up the driveway.

(2) Home hunters have wised-up to house doctoring in recent years. If you must do it, avoid the most obvious tricks, which include laying the table as if for a dinner party, burning scented candles in the bathroom and ‘artistic’ arrangements of fruit on the kitchen worksurface.

(3) Do however thoroughly declutter your house before allowing potential purchasers to view. If you haven’t used it in the last few weeks, chances are won’t need it. Make full use of your loft space and put anything that won’t fit in storage.

(4) Buyers hate vendor-led viewings, so let your estate agent do the job you are paying them for and make yourself scarce.

(5) If you must be around for a viewing, then get someone to take the kids and dogs out for a long walk.

(6) If your house is not selling, 90 percent of the time it will be because the price is wrong.

(7) Be prepared to move into rented accommodation if necessary. It could save you a lot of stress and stop you from impulse-buying the wrong house.

(8) If you have dogs, a good dousing of 'Oust' is highly recommended. Dog owners are often immune to the smells of their pets and bad odours really turn people off. Consider hiring a professional cleaning company if you have several pets in the house.

(9) If you don’t have to sell immediately, consider the effect that time of year has on property sales. If you put your house on the market at the wrong time of year, it could take much longer to sell – and buyers are suspicious of properties that don’t move quickly. If you can avoid it, don’t market your property until the spring and avoid Christmas and summer holiday periods.

(10) Visibility is everything when it comes to selling. Always ask your estate agent for a sales board, even if you live on a cul de sac or no-through road. And don’t forget to tell your friends, colleagues and neighbours that your house is for sale. People talk and word of mouth can really help with a sale.

 

Tracy Kellett, founder of BDI Home Finders is a gamekeeper turned poacher. Before setting up her property search consultancy, Tracy worked as an estate agent. Her mission is make professional home finding services accessible to everyone. In her personal life, Tracy has moved house 26 times. You can contact Tracy on 0845 603 6110 or via http://www.bdihomefinders.co.uk/

Getting a mortgage is something that all of us are likely to do once in our lifetime and some of us will do more than once. However, the process is complicated and can be a real cause of stress for home-hunters, who have to rely on third party advice as to what deal is best for them.

Before you go out there and ask around for what deals might suit you it is advisable to have at least a rudimentary understanding of what deals are available and how each one will affect your personal situation.

Repayment vs. Interest Only

Before we look at interest rates, it is important to decide which type of payment scheme you want to sign up to.

There are two types of mortgage payment schemes – repayment or interest only.

Under a repayment schemes the borrower makes regular repayments that go towards paying off the loan as well as the interest accrued. The payments are high enough that when the term of the mortgage is up you will have repaid the mortgage completely, as well as the interest accrued. This a safe option because you can be sure that at the end of the term you will be debt-free.

With an interest only payment scheme, there is a lot more risk but also the opportunity to spend your money more wisely, depending on your personal circumstances and financial restraint! The borrower only pays off the interest on the loan, with the agreement that at the end of the term the entire loan will have to be paid off in its entirety. If you are a savvy saver and can commit to making the necessary payments into a private savings account this is a good option. At the end of the term you will have saved the loan amount, and accrued interest on it while doing so.

Interest rates

Mortgages are influenced by the Bank of England’s base rate. The base rate is decided by the Monetary Policy Committee in response to the market conditions, and to a certain extent this then impacts on mortgage rates.

However, the amount mortgage rates reflect the base rate is dependent on other factors as well, such as the policy of the independent supplier and the type of mortgage deal you have signed up to. There are three main interest rate deals – fixed rate, variable and capped.

A Fixed Rate mortgage is just that – a fixed interest rate during the set term that will not change regardless of market fluctuations or base rate changes. It is a sensible option if you have financial limitations, and need to know exactly what your repayments will be and how much interest you will accrue in order to budget.

Variable Rate means that the rate of interest you pay varies over time, changing to reflect the market conditions and in response to the base rate. A variable rate mortgage is based on the mortgage supplier’s own rate policy, so the interest rate only changes at the discretion of the supplier. A tracker rate means that the interest rate automatically follows the base rate decisions. This can be a good option if you are willing to take a risk and you have an understanding of what is happening in the market.

A capped interest rate is a good compromise. It is a variable interest rate but has a capped top value, meaning you get the benefits of any major falls in the base rate but if the market swings the other way there is a limit to how high it can rise.

Making a decision

There is a lot to take into account when looking for a mortgage deal. The most important thing to factor into your decision is how stable your financial situation is now and how it might change in the future.

For someone with a bit more flexibility it could be worth looking at an interest-only or variable rate mortgage but if you are a first-time buyer with a tight budget there is security in knowing exactly what your debt and repayments will be.

The bottom line is that finding a mortgage is a complicated process and in the current environment it is advisable to get professional help.

To help you on your way HotProperty has built a new mortgage advisor finding service to put you in touch with a professional that will be able to advise you on your particular circumstances.

To use the HotProperty Mortgage adviser service, click on this link.
http://www.hotproperty.co.uk/money/mortgages

Investors need to keep up with the latest tips and market information, particularly in this challenging climate. Johnny Turner sees what’s new on the bookshelves

In property investment, as with most pursuits, information is power. And the subject of bricks and mortar as money-making vehicle is one that has had a lot of attention in recent years.
In these days of crunchy credit, with many finding financing for buy-to-let ventures harder to come by, it is more important than ever that would-be investors read up on the best way to approach the market. Here are two newly released books are must-haves.

How To Make A Million From Property, by millionaire property developer Gary McCausland, explains how you can make your fortune from property in a falling market as well as in a rising one – in fact, he says, because so many panic at the first sign of inclement weather in the property market, it can be easier to pick up a bargain and therefore make money, during bad times.
Gary McCausland has over 20 years’ experience in the property business and has developed over £50 million worth of property in the last five years. In this passionate and opinionated guide, he shares his expertise and knowledge with first-time property developers, giving them insider advice and knowledge in order to help them avoid pitfalls and common errors.
McCausland outlines his six essential elements that each life-changing deal must have, including: a price that is substantially below market value; motivated sellers; a location that’s on the up; awareness of your target market; adding value; and rapid turnaround.
Belfast-born McCausland says, ‘I came across problems that I had no idea how to resolve when I first started. If I knew then what I know now, I’d be twice as rich.’
Published  on 17 March 2008 by Collins & Brown, priced at £10.99

From the Which? Essential Guides series comes Property Investor’s Handbook, a guide to making money in property that covers renovating for profit, buy-to-let, investing overseas, making money from land and more.
A wide range of considerations are covered here, from risk management to understanding the market, from the importance of exit and back-up plans to meeting your pension needs through property.
The book’s modern, simple design serves to make the various bits of information, whether served in bite-sized facts and figures or slightly longer descriptive passages, easy to follow, digest and act on. An indispensable guide for the investor, whatever investment type or investors’ level of expertise.
Property Investor’s Handbook, a Which? Essential guide, can be ordered on 01903 828557 (at £10.99, p&p free) or at which.co.uk/books, or bought from bookshops.

 

HotProperty.co.uk runs a national index every month that monitors agents’ confidence levels in relation to the previous month.

 

The February ACI shows that agents are very confident in the market this month and buyers seem to agree. We found over half of our users are still looking into investing in property, even despite reports the market is slowing down.

 

The February index found 73 percent of agents were more confident in the market than they were in January. This is a one percent increase in confidence from January.

 

HotProperty.co.uk managing director Shawn Luetchens commented:

 

“This month’s index shows that agents’ confidence in the market is stable. It goes to show that the massive leap in confidence we saw last month wasn’t just a reaction to the January market, which is traditionally a busy period.

 

“Consumers are also showing signs of confidence; our recent research found that 44 percent of buyers have not been put off investing in property by the current market.”

 

www.hotproperty.co.uk/aci

 

We check out some of the other green options on the market including carbon neutral homes and other nifty green features to make your new home guilt-free.

 

ruralZED™, a consortium of architects and specialist manufacturers at the cutting edge of the eco house-building industry, have launched the UK’s first affordable, carbon neutral house at the annual EcoBuild exhibition.

 

The house is the first durable laminated timber frame to incorporate high levels of thermal mass that will help keep residents cooler in summer and warmer in winter, state of the art energy saving building fabric, and enough building integrated renewable energy systems to achieve zero carbon status.

 

By using a frame and traditional materials, as opposed to plastic foam, the construction is both durable and avoids problems with off-gassing and poor indoor air quality that can be inherent with other modern construction techniques. Hence it also has none of the concerns with combustibility that have been encountered with plastic foam construction.

www.ruralzed.com

 

Candler Place, Twickenham

 

Michael Shanly Homes have gone beyond the call of duty with their Candler Place development.

 

Six of the homes have solar water heating via roof mounted evacuated tubes, which contribute to the properties domestic hot water supply. Other environmental features on the development include low emisity glazing (providing enhanced solar gain), the use of selected timbers from sustainable resources, dual flush 4/6L WC systems, energy efficient kitchen appliances (‘A’ rated where possible), bird boxes to all gardens and communal grounds, lockable cycle storage, communal water butts and solar powered bollard lighting to the external areas.

 

www.michaelshanly.co.uk

 

Aspect

Upton, Northhamptonshire

 

Aspect at Upton is a development of 26 three, four and five bedroom homes feature a wide range of environmentally friendly technologies.

 

There are roof mounted photovoltaic systems which will generate electricity     to assist power to individual homes and will allow unused power to be sold back to the National Grid. Fuel bills will also be reduced by the introduction of green roofs, acting as superior insulation, keeping homes cool in the summer and warm in the winter. High efficiency boilers are assisted by solar thermal panels and      advanced combustion fireplaces powered by dry wood have been selected for optimum energy efficiency.     Harnessing natural resources also extends to rainwater harvesting for washing cars and watering gardens.

 

www.dwh.co.uk

Holborough

Snodland

 

Berkeley Homes (Kent) Ltd is the largest builder of timber frame Super E® homes in the world, with its Holborough development in Snodland leading the way in the energy saving stakes. The Super E® technology being used at Holborough creates a ‘sealed’ environment in homes.

 

This means warm air inside can’t escape through holes in windows and doors, or through the roof. The ‘sealed’ environment is achieved by using panels that are constructed under strict factory conditions for better quality control. Once in place, the panels provide an airtight setting and superb insulation.

 

The Super E® system also helps to regulate three other areas where heat is lost in the home, including the stack effect (when heat rises and cold air is sucked in), the flue effect (when warm air escapes up the chimney) and the wind effect (when a home is subjected to strong, cold winds).

 

In addition, Super E® technology employs a heat recovery ventilator that brings fresh air into the house and controls humidity. The old air leaving the building warms the incoming air, although it is never mixed. Therefore, the need for central heating is vastly reduced.!

 

www.holborough.co.uk

 

Campbell Square

Milton Keynes

 

The Campbell Square development in Milton Keynes boasts a sustainable design includeing renewable energy such as solar panels and environmentally friendly green roofing.

 

All the homes have superb facilities such as energy efficient white goods, low energy white downlighters and insulation which go beyond current building regulations. Some of the development's apartments can expect the solar panels to provide 40-50% of their hot water helping to reduce gas bills and carbon emissions.

 

The residences will comply with the EcoHomes excellence rating.

http://www.georgewimpey.co.uk/

New builds are now expected to be environmentally conscious – both during the build and in the features of the homes. We look at the winners of the annual New Homes Award Green Homes category.

 

Houses

 

 

PLATINUM - George Wimpey South Midlands - Oxley Woods

Oxley Woods makes a design statement through use of innovation and sustainable materials. The design, by world renowned architects Rogers Stirk Harbour & Partners, perfectly complements the development’s woodland setting. The development began as a competition to design a home that would cost just £60,000.  These homes achieve the maximum National Home Energy Rating and a ‘Very Good’ EcoHomes classification as well as a 40 per cent reduction in carbon dioxide emissions compared with a conventional new house of a similar size. Oxleywoods.com

 

 

GOLD - Ward Homes - Origins

Origins by Ward Homes is a unique development of homes in Ashford, Kent, including eight one-bedroom houses, nine two-bedroom houses and four three-bedroom houses. The homes have a range of eco-features including solar panels, efficient boilers, and water-saving devices and cycle storage units.  Wardhomes.co.uk.

 

 

 

SILVER  Hillreed Homes - Capell Gardens

Capell Gardens, is a development of 15 homes near Maidstone, Kent.  The homes boast a range of environmental innovations including loft insulation, double glazing, energy efficient appliances, low energy internal and external lighting, low emission and high efficient boilers.  Flow regulators on wash basin taps, showers and outside taps mnimisise water usage and as part of the service, Hillreed Homes provides all new home owners with an environmental best practice guidance welcome pack.  Hillreed.co.uk

 

Apartments

 

Green Homes

 

 

GOLD Bellway South East - Meridian South

Meridian South is a £100 regeneration project, the redevelopment of the former Hither Green Hospital in South London. The scheme, set south of Greenwich on the Meridian line, includes 544 apartments set across eight buildings.  The focal point of the development is a pedestrian piazza, while other amenities include a supermarket, restaurant and a leisure centre. Hither Green station provides a link to London Bridge, making a commute into the City quick and straightforward. Bellway.co.uk

 

 

 

SILVER Telford Homes  - Stradthaus

Stadthaus in Islington, is situated on Murray Grove, off Shepherdess Walk in N1, ideal for the City worker who wants to eliminate the hassle of car commuting and the relative unpredictability of the tube, and simply walk into work. It is an eco-friendly development, from it’s commute-free location to the secure bicycle storage, while also offering stylish simplicity and all modern comforts. Telfordhomes.plc.uk

 

 

PLATINUM Premier Properties - White Gables

White Gables has an Eco Home ‘excellent’ rating. The 14 luxury two-bedroom apartments host a number of energy-saving initiatives including solar heating and eco-friendly appliance and features. All apartments observe a below-average swelling emission rate with regard to CO² emissions.  It is also well located for reducing car commuting, with three main stations - South Croydon station and both East and West Croydon stations - within two miles.  Premier-properties.co.uk

Advice for would be investors from property entrepreneur Arv Soar

Property expert, Arv Soar is the director of investment company, Property Investment Portfolio (PIP). Arv has been working in the property industry since his teenage years and in particular in regeneration zones across the Midlands and the North of England. He now has a portfolio of over 200 properties worth in excess of £20 million and in this issue of Hot Property, offers advice to investors thinking of putting their money into regeneration areas.

Regeneration zones can provide a great return on investment for property investors because housing is often cheaper and seen as undesirable. Generally speaking, a regeneration zone is an area that is in decline, for reasons such as industry in the area has taken a downward turn, unemployment could be high or living conditions generally poor.

Once labeled a regeneration zone, it shows the commitment of the local government to invest in the area and improve its facilities. Housing plans are usually part of a wider, long-term regeneration programme and provide funds both from the UK and the EU, which are spent on creating jobs, retraining people, attracting new employers, creating an infrastructure and updating houses and living conditions. With this commitment in place, regeneration zones can prove to be a sound investment.

Pros & Cons of Regeneration Zones

In regeneration areas, the rate at which capital values and rental yields increase is generally quicker, and at a higher rate than the national average. This is because money is constantly being invested in the area.

Property prices in regeneration zones are generally very low, therefore the capital investment required is low. Rental demand in these areas is often strong and many tenants that occupy these properties are on income support and in receipt of housing benefits, therefore payments come directly from the government, which is a huge plus point. Tenants in these areas tend to stay in properties longer, as they usually come from within that area or have connections in these areas. It is also essential to employ a good management agent, who is known in the area and knows how to deal with these tenants.  They will ensure the property is kept to a good standard and will know how to vet potential tenants. 

With property investment in regeneration zones patience is key as regeneration does not happen over night.  The biggest capital growth will come at the beginning of regeneration but at this stage properties are harder to manage and require more attention. This is because typically regeneration areas have high unemployment rates, high crime rates and break-in’s are common, especially if properties are vacant. Investors also need to vet tenants stringently as they may not be able to provide financial guarantees.

The typical housing found in regeneration zones are “2 up 2 down” terrace style properties on densely populated streets, which are often found just off main roads and approached by walk ways. It is exactly these type of properties that investors should buy and the reason - capital growth and rental demand.

Top tips on how to succeed

Buying at the right time is essential in this industry. Buy during the period of regeneration, hold the property for approximately 18 months and if prices rise substantially look to sell, this will allow the investor to buy other properties with the extra cash, as deposits to reinvest in surrounding streets, where funds are yet to be invested.

Conducting thorough research of the area is also important. Do not buy just in one street, as that street may have had the immediate investment, but the surrounding streets still not – clearly these would now be a better buy. Properties just outside the zone also benefit from the ripple effect but these may be priced higher but often worth considering.

One tip is to look at regeneration schemes in operation - two main ones are the pathfinder scheme or the gateway scheme. Speak to the people involved in these schemes and find out what the plans are. If you find that the scheme has identified certain streets that have been earmarked for regeneration, ask the question: ‘does this mean grants or does this mean a clearance programme?’ If you can identify these streets before plans are officially announced, which is possible but risky, they can prove to be a great cash generator.

The plans of these schemes have lengthy approvals processes, which will give you as the investor a chance to buy the properties, which are usually the cheapest in the area, and rent them out before the CPO (Compulsory Purchase Order) plan is announced. Under a CPO plan the council will buy these houses generally to clear and from my experience, offers full market value and in a lot of cases offer incentives to the investor owner to sell. In most cases, this will involve paying a premium on the capital value or providing financial compensation for the loss of your investment. The surveyor has strict guidance to ignore the fact that the area is under CPO and therefore has to use comparables for similar properties not under CPO.

Regeneration zones can be found up and down the country but areas that have been attracting a lot of attention include Bradford, Hull, Liverpool, Leeds, East End Stratford, Birmingham and Ramsgate.

The demand for investment properties and rental values are on the increase and property assets are still leading the way in the investment market. This market is still very much on the up so there is no better time to get started.

For more information on Property Investment Portfolio, please visit www.propertyinvestmentportfolio.com, call +44 (0)115 928 9333 or email info@propertyinvestmentportfolio.com