Buying, selling and letting - April, 2006

House sales up

House sales increased in March for the third consecutive month running, according to the monthly housing survey by the National Association of Estate Agents (NAEA). The findings lend credence to the idea that consumer confidence has returned to the market.
The pace of the market is also picking up, with the time taken to sell decreasing, also for the third month in a row. Meanwhile, first-time buyers have been reclaiming a larger share of the market while competing with a rise in investors looking for buy-to-let opportunities; first-timers accounted for 8.9 per cent of buyers, up from 7.8 per cent the previous month.
House sales have increased by an astounding 40 per cent since January, from an average of ten sales per agent to 14 in March; this is a 16 per cent rise on March 2005. This surge in the property market has been assisted by reported increases in house prices by 3.4 per cent in February, alongside cheaper borrowing. Fixed mortgage interest rates were reported to be at 4.72 per cent on average in February 2006 compared to 5.23 per cent March 2005.
There was an 11.7 per cent increase in the number of buyers in March with an average of 371 on estate agents’ books, and a 4.9 per cent decrease in houses available, with an average of 61 houses per agent. Demand continues to outstrip supply in many areas of the market. Noticeably, the gap between asking price and final sale price closed further, indicating that sellers are being more realistic, contributing to what appears to be a vigorous market.
NAEA president Christopher Hall comments: ‘It is wonderful to see confidence from both buyer and seller return to the housing market. The market is back on track following a slight cooling-off and dip in 2005. The picture for 2006 is very positive indeed.’

Hotspots get cool reception from movers

Worldwide ‘hotspots’ for property investment are failing to attract UK home movers, according to Royal Mail’s recently launched relocation index.
The index, which is based on mail redirection data from the past year, shows people from the UK moving abroad are choosing to do so away from the new breed of fashionable investment locations such as Central and Eastern Europe and Dubai. Traditional favourites including France, USA and Spain remain the most popular locations.
France was most popular, with more than 13,000 UK households opting for a Gallic way of life. Almost 8,500 chose Spain, despite it being the UK’s number one second home location. Australia, New Zealand and Canada all feature in the favoured location list.
But while recent property boom locations such as Croatia, Slovakia and the United Arab Emirates are an attractive investment, Royal Mail figures show fewer than 1,150 households opted for their mail to be redirected to those countries.
Fraser Chisholm, Royal Mail’s redirection expert, said: ‘Because it is based on redirection data, the index gives a strong signal on whether property is being purchased to live in, rather than purely for investment purposes. As such, it provides a real insight into the countries that people from the UK want to call home.’

Offset, or current account, mortgages can help buyers make the most of their money. But not everyone would benefit from this type of home loan, says Martin Aitken & Co

More and more banks and financial institutions now offer current account, or offset mortgages. However, Adrienne Airlie, financial services partner of Glasgow accountancy firm Martin Aitken & Co says there are risks involved with these increasingly popular mortgage products.
While offset mortgages, with their scope for combining an all-in-one account for savings and mortgage payments and hence helping to pay a mortgage off more quickly, may seem an appealing option, they are not a solve-all solution suitable for every borrower.
The offset mortgage operates by allowing home owners to reduce the amount of interest they pay on their mortgage by the amount of savings or current account credit balance that they receive interest on. This allows any amount the borrower has in credit to offset the debit balance of the mortgage.

Airlie says, ‘Offset mortgages are an appealing option which can offer an accelerated route to capital repayment on an individual’s mortgage. They can also offer significant savings, improved rates of return, flexibility, financial security and tax efficiency if used wisely.
‘However, the offset mortgage should be entered into with caution because while there is the potential to offer scope for significant savings, this is generally only the case for higher-rate taxpayers who have a significant level of savings to balance their mortgage against. The option will not prove to be effective if the individual has little savings or they draw down too much and effectively squander the equity on their homes.’

Airlie gives the example of taking two individuals with the same amount of mortgage and savings but differing tax status. She says: ‘The higher rate tax payer, who would pay 40 per cent tax on interest earned from savings or bank accounts, would benefit more. This is because the amount they save with an offset mortgage would be the interest saved on the mortgage minus 60 per cent of interest lost on savings (100 per cent compared to 40 per cent).
‘However, while the basic rate taxpayer would only have to pay 20 per cent tax on interest earned from savings or bank accounts, they would only benefit by the amount of the interest saved on the mortgage minus 80 per cent of interest they would lose on savings (100 per cent compared to 20 per cent).’

A higher rate taxpayer would generally benefit more than a basic-rate tax payer, when comparing identical amounts of capital outstanding on a mortgage of £100,000, and with £20,000 in savings. The higher rate taxpayer would save £560, as compared to £380 for the lower rate taxpayer, given a mortgage rate of 5.5 per cent and a savings deposit rate of 4.5 per cent, according to Airlie.
She makes the case that the offset mortgage is generally a product which is of more benefit to those who have significant savings and operate within a higher tax bracket. ’People who generally do not have a good level of savings in the first place are more easily at risk of incurring significant shortfalls at the end of their mortgage term and this can be exacerbated should they make regular underpayments and not enough overpayments to cover this in the long term.’

Borrowers should also be aware that some lenders do not offer as competitive rates or terms for offset accounts. For example, access to fixed-rate periods may be restricted and in certain economic climates this can increase the inherent risk of the product.
As with all financial advice and products specific advice should be sought from an independent qualified financial adviser.

Green issues trump love of gadgets

The environment has beaten the gadget as the most desired feature of the UK's ideal home of the future, in a nationwide audit carried out by Ipsos MORI on behalf of Norwich Union Direct. The study, which polled over 2,000 Britons, asked the UK to prioritise the features they would most like to have in their home of the future. The biggest concern for Londoners was safety; 58 per cent of respondents in the capital opted for a burglar-proof home, making it their most desired feature.

Meanwhile, despite concerns about safety and rising crime levels, the UK as a whole placed the issue of home security lower down the agenda with the environment taking pride of place.

Over three-quarters of the nation want a more environmentally friendly home. However, just over half of Londoners asked also desired a 'greener' home. Fifty-two per cent of Britons opted for a home built from renewable resources, compared to 36 per cent of Londoners.

Technological developments in robotics and 'intelligent' household systems are the hottest topics around – yet these items were found to be of considerably less importance than environmental factors, both nationally and regionally, with only 21 per cent of Londoners interested to see more gadgets in their homes in years to come.

Commenting on the research, Ann Maurice, television's House Doctor, said, 'The really compelling thing about these findings is that we've discovered that people are keen to put environmental concerns over their own luxury and comfort. While intelligent lighting systems and other really exciting innovations get our imaginations working, what people really care about is the planet we all live on.'

High prices mean buyers wait longer

Escalating house prices are forcing first time buyers to wait until they are 30 to own a home according to research by SmartNewHomes.com. The survey of 'first-time buyers in waiting' reveals that the average age by which they expect to buy their first home is 30, while almost 40 per cent don't expect to own a home until they are over that age.

First-time buyers blame financial woes almost entirely for their struggle to get on the property ladder, with 85 per cent pointing to rising house prices for pushing property out of their reach. Fewer than 15 per cent of the respondents to the survey cited non-financial reasons; 3.8 per cent shun the responsibility and commitment of home ownership, while 10.9 per cent say they have not yet found the right property.

First-timers typically face two big financial hurdles to getting a foot on the property ladder: securing a sufficient mortgage and raising a deposit. The survey finds that first-timers expect to spend an average of £153,029 on their first home, more than seven times the average earnings of £21,266 for the age group 22 to 29. Even with two people buying a property together, as over half of the first time buyers questioned intended to do, salaries of this level would only secure a mortgage of around £116,000.

Average London home tops £300,000

The average price of a London property has cleared the £300,000 mark, according to the latest figures from the Land Registry. Prices in the capital rose overall by four per cent on the figures for July to September 2004, from £287,470 to £300,329.
The biggest gains were in the more expensive boroughs, which had been worst hit by the slowdown in the housing market; Camden, Haringey and Kensington & Chelsea each saw price rises of ten per cent on the same quarter last year. Brent also saw a steep rise of nine per cent, while Hammersmith & Fulham, Islington and Southwark experienced price rises of eight per cent compared with summer last year.
Experts say the Bank of England’s August interest rate cut is continuing to bring confidence to the market. The upcoming bonus season for City workers is expected to help the property market still further.

Buy-to-let bounces back

With house prices back on the rise, deposit upon exchange falling back to just five per cent and excellent developer discounts, the UK buy-to-let market is attracting British investors back from abroad, reports investment specialist Assetz.
Over the period of August 2004 to August 2005 the UK buy-to-let market was over-inflated, with developers asking prices that were often too high, even after off-plan discounts. Following the recent downward trend in interest rates, in addition to bank pressure on developers to achieve sales targets, prices have become more realistic and opportunities in the buy-to-let market have returned.
Investors are currently enjoying good discounts on new properties and are usually only required to put in a total deposit on completion of between five and ten per cent rather than the 15 per cent that has historically been asked. The balance of the deposit is contributed by the developer in the form of a subsidised deposit, like those given to first-time buyers, or a cash-back rent guarantee. Not all lenders accept these types of incentives but those that do are reaping the rewards.
The deposit required on exchange is back to five per cent in many cases, instead of the ten per cent developers were achieving last year. This means investors have less cash tied up in investments on exchange and less cash required to complete too, leading to greater returns if prices rise. The built-in equity through the discounts on purchase price also provide a safety net for any price falls.
Stuart Law, managing director of Assetz, comments: ‘There has been a noticeable surge in UK investment purchases over the last month as UK investors realise there is money to be made on home shores again, without the hassle of overseas investments. According to Paragon, rents are rising at 10.5 per cent per annum, suggesting that rental incomes will soon well exceed the cost of a buy-to-let mortgage and become profitable again. We expect to see house prices rising at five to seven per cent next year, offering the potential for vast returns on minimal initial investments.’

New home prices drop

New home prices in the UK dipped again last month as the housing market struggles to throw off the after-effects of a year-long slump.

The average price of a new home in the UK was £255,327, down 2.4 per cent on the same time last year and a further marginal decrease of 0.2 per cent from the previous month according to the report from SmartNewHomes.com, the UK’s leading new homes website.

The report dispels hopes that the housing market has fully recovered from the downturn in prices and activity which has blighted it since the end of last year. Although the worst of the downturn looks to be over with annual inflation now at -2.4 per cent compared to -8.0 per cent at its lowest point in spring this year, continuing negative quarterly inflation would indicate that a return to the strong positive growth rates of the last few years is some way off.

Average new home prices in London, the South West, West Midlands and the North suffered the worst of the wider market slowdown, whilst East Anglia and Wales saw prices rise. Measures of migration between regions in the UK shows a seasonal slowdown in the ongoing exodus to both the South West and Scotland although both remained popular regions, whilst the West and East Midlands slumped further out of favour with homebuyers.

The readjustment in prices was mirrored across all property types with the exception of apartments which, as well as seeing prices rise 1.7 per cent over the last month, continue to dominate the market with over half of all new homes. Town houses saw the largest price drop of 6.6 per cent over the last quarter.

Andrew Frankish, technical director at Mortgage Talk, offers some down to earth advice for home owners considering entering the buy-to-let market.

What is buy-to-let and what are the advantages?

Buy-to-let is the purchase of a property specifically as an investment to let out – not for personal residency. The basic idea is that you will let tenants fund the ongoing investment. Most buy-to-let properties are let out short-term, although there is generally a minimum term of six months.
A buy-to-let property can be regarded as a self-funding investment. Subject to the monthly mortgage repayments and any ongoing maintenance costs, if the rental income exceeds the aggregate of the outgoings then the property owner is making a net profit.
Added to this is the fact that over time the value of the property is likely to increase as well. And if you opt for a capital and interest repayment mortgage you can also take into account the possibility of reducing your overall debt, leaving you with an increasing asset as well as a regular monthly income.

Who can obtain a buy-to-let mortgage and how much can I borrow?

With the skyrocketing popularity of buying as an investment, many more lenders offer buy-to-let home loans. Subject to status and valuation, a buy-to-let mortgage can be obtained by anyone over 18 who is not a first-time buyer. Lenders will generally require a good credit rating and often need evidence of an annual income of at least £25,000.
Buy-to-let loans are not calculated according to traditional income multiples like residential mortgages. Instead, they are based on the monthly rental income that is estimated to be achievable from the property.
Generally, the monthly rental income figure will need to be between 125 per cent and 150 per cent of the interest payable on the loan – for example, if the mortgage interest is £350 then the rent must be £438 or higher. Regardless of the particular mortgage scheme that is taken out, the
interest is calculated on the basis of the lender's SVR.

How much deposit will I need?

The minimum deposit for any buy-to-let is currently 15 per cent. However, many lenders require up to 20 per cent or even 25 per cent of the purchase price of the property.
How much interest will I pay?
Dedicated buy-to-let mortgage products used to be more expensive than conventional residential mortgages, but nowadays there is a whole series of highly competitive products available from a variety of lenders, including
discounted, trackers and fixed rates. Thanks to these, it is still possible to find a mortgage as much as one to 1.5 per cent below the standard variable rate.
What are the tax implications?
Any rental income derived from a buy-to-let property is taxable in the same way as earned income from a salary. In addition you may well be liable to pay capital gains tax on the profit made when you come to sell.

TIPS FOR LANDLORDS & PROPERTY OWNERS WISHING TO APPOINT A LETTINGS AGENT

As a landlord or property owner, finding tenants and managing the letting process can be timely. Letting agents can take away the pressures and apply the required attention to detail, easing the pressure and delivering solutions to lettings needs.

Surelet, one of the country’s leading letting agents provides its top tips on key things to look for when appointing a letting agent.

* Ask whether your agent is a member of approved body such as ARLA or NALS.
*Seek advice from your agency before deciding to let furnished or unfurnished and obtain a free rental valuation
* Check how the agent finds suitable tenants and be specific regarding tenant selection e.g. children, pets, smokers and instruct your agent accordingly
* Ensure that your agent carries out stringent referencing of tenants
* Ensure that your agent offers you advice regarding the correct form of tenancy agreement
* Ask your agent for up to date advice on Health & Safety issues e.g. Gas and Electricity
* Ensure that your agent takes a deposit equivalent to at least one months rent. Your agent should also offer you advice regarding the new deposit schemes which come in to effect in 2006.
* If your agent offers rent guarantee establish precisely what this means
* Establish from the agency how they deal with arrears, notices and other legal issues
* Ensure that your agent carries out periodic inspections at least once every three months and reports their findings to you.
* Ensure that your managing agent provides 24 hour, 7 days a week cover for your property - maintenance issues or providing suppliers for example
* Finally, read and agree the terms and conditions of your agreement with the agency before you sign

Letting a property should provide a stable and profitable source of income for landlords. Surelet’s management centre provides a 24 hour service to ensure that the correct advice is provided and issues managed quickly and efficiently by a team of qualified professionals.                                                                      

Surelet coordinates the management of over 2,000 properties, 1,400 landlords, and over 3,000 tenants. For more information on Surelet, its properties, services and franchise opportunities, log on to www.surelet.co.uk

March sees price rise

House prices have risen by 0.5 per cent in March, according to the latest survey from Hometrack, the housing research and data company. This is the fourth consecutive month of house price growth and the highest monthly rise since the summer of 2004. Over the past 12 months house prices have risen by 0.1 per cent, the first annual rise since January 2005. The national average house price now stands at £162,500.
‘A resurgent market in London, where prices grew by 1.1 per cent, has put something of a gloss on the headline results,’ comments Richard Donnell, Hometrack’s director of research. ‘Whilst prices moved 0.4 per cent higher in the South West, East Anglia and the South East, growth in all other regions has been far more limited,’ he adds.
A key feature of the last three months has been the growing mis-match between the number of new buyers entering the market and the amount of housing for sale. This is providing an important support to price levels. Nationally there was a seven per cent rise in buyers over March, compared to a 3.7 per cent increase in the number of new properties for sale. In London, the stock of properties for sale grew by just one per cent over March while demand grew by ten per cent.

Modest improvements in time to sell and achieved prices

Despite signs of more buoyant demand there has only been a slight improvement in the proportion of the asking price being achieved over March. Sellers are achieving 94.3 per cent of the asking price, up from 94.2 per cent last month. Properties are also selling slightly more quickly whilst the average number of viewings per sale has decreased. There are some major differentials between the regions. For example, the average time to sell a property is 4.5 weeks in London compared to over 9 in the East Midlands and the North West where growth remains sluggish.
 
Budget makes modest housing progress

Chancellor Gordon Brown outlined plans for 100,000 new homes as he delivered his tenth budget last Tuesday. Other budget highlights for the housing sector include £970 million for shared equity, helping 35,000 Britons become home owners.
The introduction of real estate investment trusts (REIT) supersedes the policy of allowing property purchase via a pension plan, which was much ballyhooed but abruptly shelved in December.
The much-criticised stamp duty threshold is raised, but not by an amount that is likely to thrill estate agents or first-time buyers: the current figure of £120,000 goes up by only £5,000. Meanwhile, the inheritance tax exemption threshold will see a phased-in rise, from £275,000 to £325,000 over the next four years.

Confidence in housing market up

Consumer confidence in the housing market has seen the largest rise since May last year when confidence rebounded after a marked pre-election nosedive, according to Propertyfinder.com’s February survey.
Confidence is now back to levels not seen since early 2004, when Mervyn King, chairman of the Bank of England’s monetary policy committee (MPC), famously warned that the house price falls should be expected.
Seventy per cent of respondents now believe the housing market will rise over the next 12 months, a figure that’s up from 62 per cent in January. On average, house hunters expect prices to rise by 4.0 per cent. This contrasts with the November 2004 low when 67 per cent expected prices to fall by an average of eight per cent.
Jim Buckle, chief executive officer of Propertyfinder.com, commented: ‘All our indicators point to a healthy, balanced housing market which is good news for everyone. A confident market dispels the fear factor from the decisions that people need to make over their homes. What’s more, modest price increases broadly in line with earnings growth mean that affordability is not being stretched any further.’

‘Retainers’ squeeze central London supply

An increasing number of home owners are choosing to retain their properties in central London rather than sell them as they move up the property ladder, says Hurford Salvi Carr, a Clerkenwell-based agent. This trend is squeezing supply and creating a shortfall in the number of available properties on the market for sale – which, in turn, has resulted in a rise in central London prices. The five per cent increase recorded in the first two months of 2006 follows a five per cent rise in the second half of 2005.
Hurford Salvi Carr highlights that available properties for sale in the City, Clerkenwell and Docklands areas decreased over a two-year period from 2003 to 2005 by 18.5 per cent. However, over the same period properties available for lettings rose by six per cent, mainly driven by buy-to-let investors as well as owners renting out their existing property as they move to another home. Furthermore, comparing the first two months of 2006 to the first two months of the previous year, there was a 30 per cent decline in properties placed on the market for sale.
David Salvi, marketing and agency director of Hurford Salvi Carr, comments: ‘Property owners in the City, Clerkenwell and Docklands areas are holding on in anticipation of rising capital values. Meanwhile, generous City bonuses have boosted demand for properties.’

Fourth bedroom costs dear

Hometrack has revealed that the greatest financial leap up is for home owners moving from a three-bedroom house to a four-bedroom house. The average uplift in value is 37 per cent or £64,032. In regions such as London the uplift is as high as £131,300.
Using data from the company’s property valuation system, the headline analysis shows for the first time how much extra an average home owner will need to pay to make a step up the housing ladder.
The least expensive step up the property ladder, in proportion to the value of the home, is moving from a two-bedroom to a three-bedroom house, with the average increase in value at 19 per cent (£27,123) – or 15 per cent, or £27,144 in the South East.
Richard Donnell, director of research of Hometrack, comments: ‘The results of this analysis are driven by the nature of supply in local housing markets and the profile of demand and buying power of households in those markets. We estimate that nearly half of all private housing stock is made up of three-bed properties. Properties with four or more beds immediately attract some scarcity value and this drives a higher average price. The jump from two-bed homes is smaller because high house price growth over recent years has concentrated demand in the lower price ranges and this has compressed the price differentials.’

February increase

Meanwhile, Hometrack finds that house prices increased by 1.4 per cent in February, more than offsetting January's fall. The mixed pattern of monthly price rises and falls is a typical feature of a slower housing market.
Annual house price inflation, at 5.5 per cent, was broadly unchanged from December 2005 and January 2006.
UK house prices are forecast to rise by three per cent in 2006, broadly in line with the predicted rise in retail price inflation. The annual rate of house price inflation is, nonetheless, expected to increase over the next few months as modest price rises compare with slight falls in early 2005. The annual rate is then expected to fall as prices rise at a slower pace than in the second half of 2005.
Martin Ellis, chief economist, said: ‘The combination of improving economic growth, low interest rates and high employment will continue to underpin a healthy level of housing demand over the next few months.
‘A number of factors, however, should constrain housing demand and prevent a significant, and sustained, acceleration in house price inflation in 2006. The continuing high level of house prices in relation to earnings will curb the ability of many potential first-time buyers to enter the market. Council tax and utility cost increases of well above inflation in 2006 will also put downward pressure on householders' finances. Additionally, the weakening in the labour market should temper housing demand.’

Villas gaining in popularity abroad

Although most Brits still opt for an apartment when buying a home in Spain with a mortgage from Norwich and Peterborough Building Society (N&P), the popularity of detached and semi-detached villas rose slightly, while the number of people buying apartments and terraced properties fell again during 2005, according to the Society.

TIPS FOR LANDLORDS & PROPERTY OWNERS WISHING TO APPOINT A LETTINGS AGENT

As a landlord or property owner, finding tenants and managing the letting process can be timely. Letting agents can take away the pressures and apply the required attention to detail, easing the pressure and delivering solutions to lettings needs.

Surelet, one of the country’s leading letting agents provides its top tips on key things to look for when appointing a letting agent.
Ask whether your agent is a member of approved body such as ARLA or NALS.
Seek advice from your agency before deciding to let furnished or unfurnished and obtain a free rental valuation.
Check how the agent finds suitable tenants and be specific regarding tenant selection e.g. children, pets, smokers and instruct your agent accordingly.
Ensure that your agent carries out stringent referencing of tenants.
Ensure that your agent offers you advice regarding the correct form of tenancy agreement.
Ask your agent for up to date advice on Health & Safety issues e.g. Gas and Electricity.
Ensure that your agent takes a deposit equivalent to at least one months rent. Your agent should also offer you advice regarding the new deposit schemes which come in to effect in 2006.
If your agent offers rent guarantee establish precisely what this means

Establish from the agency how they deal with arrears, notices and other legal issues
Ensure that your agent carries out periodic inspections at least once every three months and reports their findings to you.
Ensure that your managing agent provides 24 hour, 7 days a week cover for your property - maintenance issues or providing suppliers for example .
Finally, read and agree the terms and conditions of your agreement with the agency before you sign

Letting a property should provide a stable and profitable source of income for landlords. Surelet’s management centre provides a 24 hour service to ensure that the correct advice is provided and issues managed quickly and efficiently by a team of qualified professionals.                                                                      

Buy-to-let statistics up

The buy-to-let market has experienced a New Year pick-up, according to Paragon Mortgages’ January buy-to-let index. The survey shows improvements across the board, with rising rental incomes, property values and rental yields.
In England and Wales average rental incomes rose by 1.22 percent over the month from £10,363 in December to £10,489 in January – a higher percentage than the growth in property values, which were up 0.68 percent.
Over the last three months rental incomes have increased by 3.33 percent, which has helped to push up rental yields. From December to January rents rose from 6.42 per cent to 6.45. John Heron, managing director of Paragon Mortgages, says, ‘With demand for rented accommodation from tenants steady or growing in many areas, landlords have been able to achieve higher rental yields, notwithstanding the continued rises in property values we’ve been seeing recently.’

Price uncertainty causes concern

Fluctuating property prices across the UK are still a major source of concern to those thinking of moving house, according to an independent survey commissioned by Systemline Modular, the in-built multi-room entertainment system.
Nearly two-thirds of those questioned admitted that they are worried about the uncertainty of house prices, with over half of them believing that house prices will rise in the next 12 months. However, 24 per cent are still planning to move house in the next two years and intend to spend an average £197,000.
Price came out as the most important driver when buying a house, with good-sized rooms a close second. The safety of the neighbourhood was listed third overall; however in the South it was deemed more important than room sizes. In the North of the country, making a good investment was seen as more important than having a garden.
Just over half of those questioned would consider purchasing a newly built property; men were particularly attracted to the idea because of the lack of maintenance required, while women liked the fact that everything was new and looked smart. The ability to customise their home to their lifestyle, needs and budget by choosing optional additions was also a hit.

Britons to inherit £360 billion

Halifax Financial Services (HFS) estimates that £360 billion in today's money of housing assets will pass from one generation to another over the next 15 years. This transfer of housing wealth is the largest of its kind recorded in the UK.
According to the HFS report, the value of housing assets inherited every year will more than double from £14 billion in 2002–3 to £32 billion in today's money by 2019–20. HFS calculates that £32 billion, or 60 percent of the total value of all estates in 2019–20, will be accounted for by housing. In addition, the number of estates with property assets is expected to increase from 104,950, or 59 percent of the total in 2002–3, to 115,347 or 65 percent in 2019–20.
The first baby boomers will turn 60 this year and begin to retire. Baby boomers currently number 15.8 million and account for 27 percent of the total population. They will play an important part in the intra-generational transfer of housing wealth that is to come. More baby boomers (78 percent) own their own home than any other UK age group. In addition, baby boomers have witnessed an extraordinary transformation in British society: the rise of owner occupancy. In 1946, an estimated 31 percent of households owned their own homes. By 2001, this number had more than doubled to 70 percent.

Those who want to build in their garden need to find out what permission is needed. Moira Fraser, head of the Town & Country Planning unit at Thomas Eggar looks at the rules
When looking to make major structural additions to a property, most people appreciate they may require planning permission. However, when it comes to the garden many still wrongly assume they can do pretty much what they like.
Every day people erect garden sheds, lay paths and dig out swimming pools without a thought to whether these activities require planning permission or not. It can, therefore, come as a huge surprise when home owners find they may be liable for a fine or be required to return the garden to its original state.

Of course, if every householder who wanted to make seemingly harmless additions to their garden had to obtain planning permission, the whole system would grind to a halt and council planning departments would be drowning in a flood of applications. For the most part sheds, paths and swimming pools are uncontroversial and have little impact on the neighbourhood.
To avoid planning departments being completely clogged up with householder applications for inoffensive developments, there is a statutory instrument called The Town & Country Planning (General Permitted Development) Order 1995. This grants blanket planning permission for, among other things, certain kinds of household development.

The basic rules

However, in order to qualify for the broad approval, the development must adhere to specific restrictions and limitations which are set out in the Order. For example, Class E of the order says that a development is permitted within the garden if it is for the enjoyment, maintenance or improvement of the house.

This section of the legislation will cover most items a home owner would want to erect or construct within a garden. However, it would exclude a situation where a householder wanted to build a studio for the provision of private dance lessons, as this might not be considered appropriate.
There have been a number of interesting, and sometimes amusing, cases where householders have gone to court in an effort to argue that their idiosyncratic requirements fall within the enjoyment of the house. One example that failed the test was a householder who kept a large wooden replica of a Spitfire in his garden!

A development is not permitted by Class E if:

It is within 20 metres of the highway the building to be constructed would have a cubic content greater than ten metres, and any part of it would be within five metres of any part of the dwelling house
the height of the building or enclosure would exceed four metres
the total area of ground covered by buildings or enclosures within the garden (other than the original dwelling house) would exceed 50 per cent of the total area of the garden
It should also be noted that homes in areas of conservation or outstanding beauty do not have the same breadth of permitted development rights as houses not in such areas. The beneficial provisions of the Order also only apply to houses, not to flats.

Planning permission can be fraught with difficulty. For help navigating the maze of law and folklore surrounding this area contact Moira Fraser at Thomas Eggar on 0870 160 1300.

FAQs  

Do I need planning permission to keep bees?

The good news for animal lovers is that the Order makes specific allowances for them. It states that activities such as the keeping of poultry, bees, pet animals, birds or other livestock for the domestic needs or personal enjoyment of the occupants of the house are permitted.

What is the legal definition of a garden?

In legal terminology, the garden is referred to as the curtilage. Exactly what this entails is another area where case law is full and varied. A general rule of thumb is that the curtilage is the formal garden immediately around the house and does not include, for example, the paddock beyond the formal garden. If you want to build a tennis court in the paddock then that development will not be covered by the General Permitted Development Order and will need explicit planning permission.

Are there different rules for new houses?

When granting permission for new housing developments, a number of planning authorities have started to remove the permitted development rights from the houses by including a condition on the planning permission to that effect.
If your house is quite new it is always wise to check any planning permissions affecting the house to ensure there are no conditions which seek to remove permitted development rights.
Even if you have only had an extension built, the planning authority could have used this as an excuse to remove permitted development rights by condition.

What if I’m not sure the regulations apply to me?

There will be circumstances where you are not sure if what you want to build in your garden will fall within the tolerances of the permitted development rights or not. In these circumstances you can either apply informally to the planning authority for an opinion or you can apply formally for a Certificate of Lawful Proposed Use or Development. If the Local Authority grants such a Certificate then it will be acceptable to proceed with the development without obtaining planning permission.

Banner Homes’ professional interior designer Dee Hawkins reveals key trends for this year.

The new year is a fantastic opportunity for a fresh start, whether you have a new home to decorate or need a re-vamp for an old one. However, when faced with a blank canvas it can be difficult to know where to start. Here Dee Hawkins, in-house interior designer for Banner Homes, reveals what’s hot for the home and provides some useful tips to guide you.

‘The key is not to think of the whole room at once – start with just one item and work your scheme around it,’ Dee explains. ‘It could be some wallpaper, or an item of furniture, or even a simple vase, but let your room grow from it, piece by piece, so that you do not get overwhelmed.’

Dee suggests that, as current trends are moving away from the bland magnolia minimal look, using strong colours and textures is a good way to proceed. ‘There is plenty of colour around at the moment, and florals are back in too, so there is lots of scope for texture and pattern.’ she says. ‘Stick to more modern designs, though, in order to avoid your scheme looking too ‘busy’. Dark furniture is also very much a trend at the moment, and in the Banner show homes I try to mix different types of furniture to create a sense of individuality,’ she continues.

One of the most important elements of a new scheme, according to Dee, is the opportunity to ‘de-clutter’; ‘Most of us have things stored in cupboards for 20 years, and 90 per cent of it we don’t miss - you will feel much better if you get rid of it all,’ she says. ‘Use your new design as an opportunity to move forward and shed the old, de-clutter and resume control over your environment. Maximise storage and then you will have a home with plenty of space for you to enjoy.’

Regeneration areas are a hit with investors.

UK investors are flocking to selected regeneration areas, where values are far outstripping national house price growth, says Assetz, who recently launched a new residential property fund specifically focused on such zones.
Regeneration areas such as London's Elephant and Castle, Stratford in east London and parts of Manchester city centre, which have well-funded development plans in place, are proving irresistible to investors with a five- to seven-year view.
Property in these zones is usually available at below city-average prices, with expectations for above-average growth when the area becomes more attractive. House prices in the regeneration area would be expected to rise over a few years up to the city average as the redevelopment takes place, giving the investor additional capital gain.
Stuart Law, managing director of Assetz, says, ‘The discount in prices compared to the rest of the city means that the investor has a safety cushion should prices in the surrounding city suffer a downturn.’

E-conveyancing moves forward

Land Registry has carried out further consultation regarding the introduction of electronic conveyancing in England and Wales, according to Baroness Ashton of Upholland, Parliamentary Under Secretary of State for Constitutional Affairs.
‘The implementation of this important reform programme will continue to be carried out incrementally,’ said Baroness Ashton in a written statement. ‘A prototype in 2006 (the Chain Matrix) and a pilot exercise in the second half of 2007 (the system to be used for domestic sales) are planned, with further releases as the system progresses.’
These exercises will be limited to voluntary users, she said. However, compulsory use of e-conveyancing is likely to happen in 2009 or 2010, she said. E-conveyancing will transform the current paper-based conveyancing system into electronic documents, requisitions and signatures and is a central pillar of the government’s agenda to modernise public services.

Looking for a solid investment? The newly built property market is a good bet, says Johnny Turner.

Investors make up a large segment of today’s purchasers, and this shows no sign of abating. Those in the market for a buy-to-let investment will want a property that ticks a number of boxes. The home should involve minimal capital outlay and ongoing maintenance, be attractive to good-quality tenants and have good prospects for capital growth in the mid- to long-term.
There are many developments currently on the market that offer excellent newly built properties fulfilling these criteria and more. One such scheme is

NORDIC - COOL SHOW APARTMENT NOW OPEN

Leading developer Rydon Homes has just opened the doors to its chic new show apartment at the Nordic Apartments in Shadwell, E1, one of the hottest locations for 2006.
Located on the fifth floor of the Ikon building, one of three buildings at the stunning new scheme, the two bedroom show apartment offers 677sqft of accommodation.  The kitchen is open plan to the living area, which leads out onto a balcony providing stunning views of the City.  
The kitchens at Nordic Apartments are a fusion of practicality with contemporary simplicity and style. Elegant and versatile storage is combined with attractive details, including laminate work surfaces with glass up stands, integrated appliances to include oven, hob, hood, combi microwave, fridge freezer, dishwasher, washer dryer and waste disposal.
The master bedroom suite features fitted wardrobes and an en-suite facility while the second bedroom, which is also a double room, has fitted wardrobes and access to a separate bathroom.

Robert Kerr, Marketing Manager for Rydon Homes comments: “The Nordic Apartments offer a range of ultra-cool modern homes, from single bedroom living utilising a flexible open plan approach to spacious two bedroom penthouses with private balconies.  The new show apartment reflects a relaxed and comfortable lifestyle with chilled out naturally toned interiors to enable residents to create a surrounding that suits them most.”

Located just 400 metres from the River Thames, and just ten minutes from Canary Wharf, The Nordic Apartments is a collection 97 one, two and three bedroom apartments.  Many of the apartments have spacious open plan layouts, and there are some exclusive two bedroom penthouses with private balconies or terraces available.

Accessibility from Nordic Apartments is second to none. Shadwell’s DLR and tube stations are just 800 metres along Cable Street, putting the rest of London within easy reach. The West End is a 17 minute journey and Bank just four minutes. Canary Wharf is 10 minutes away in the opposite direction and less than 20 minutes on foot via the Thames riverside walk.

Rydon Homes new marketing suite and show apartment at the Nordic Apartments is open Monday to Saturday 10am to 5pm and at other times, strictly by appointment only.

Prices start from £189,950.  For further information, contact the Marketing Suite and Show Apartment on 0207 780 1580, or visit the development’s website at www.nordic-cool.co.uk

Imagine Homes introduces a novel approach to buying as an investment. Those who want to buy a property to let but want to minimise the risk involved will be interested in Imagine’s ‘buy already let’ method. Whether you are a regular property investor or are looking to get a first rung on the investment property ladder, Imagine Homes have a unique approach to help you build or start your investment property portfolio.

You can invest in a property the traditional way or do things the Imagine Homes way and buy a brand new property with our unique two-year rental income guaranteed.  In other words you buy already let.
This is how it works.  We guarantee you 2 years' rental income at 15% of the purchase price.  You get a cash lump sum equal to 7.5% of your property paid to you annually, upfront, over the 2 year period.
With Buy Already Let, we do all the legwork.  Just choose a property from our large portfolio, all chosen for their high rental yields and capital growth potential.  We'll pay the legal fees, find a tenant and manage it.  After 2 years you can inherit our tenant, sell the property, rent it out or just move in.
Even better you can benefit from up to 2 years growth whilst your chosen property completes giving you up to 4 years hassle free investment.

Find out about the latest selection of properties we've just released on to the market.  Your new place already has the perfect tenants and rental income
built-in.

One particular development for sale by Imagine Homes is City Tower @ Canary Wharf
A rare investment opportunity to obtain private units in a cascading 16 storey development in a prime location, close to Canary Wharf, London, UK.

Fantastic location - office and commercial developments at Canary Wharf are planned to keep growing for 10 more years, driving demand for residential property which will become increasingly limited
High specification luxury living and a range of 1 and 2 bedroom apartments
Excellent connections via Crossharbour Docklands Light Railway and Jubilee Line through Canary Wharf into mainframe London transport networks, scheduled boat service along the Thames, close proximity to London City Airport and easy access to London Stansted
Competitively priced - Remarkable value in comparison to adjacent new and under-development residential property in the area
Call 0800 458 5050.

Barratt offers an excellent buy-to-let incentive on its Byron Court development in popular Harrow. The six per cent gross rental guaranteed for 2 years* gives added peace of mind to would-be investors.
Latest availability: 2 bedroom apartments

Price range: £235,000 to £255,000

For people with places to go, Byron Court boasts superb transport links to Central London and beyond. The A40 is only a few miles away, which runs via the Westway into the West End, and connects with the M25 at Junction 16. From here, Heathrow Airport is easily accessible. Harrow and Wealdstone provide both National Rail and tube services. Overground trains run to London Euston in just fifteen minutes, whilst the Bakerloo Line runs to Piccadilly Circus in forty one minutes.

All of this makes Harrow one of the most sought after locations in London. You can shop until you drop in the town's modern shopping centre, where big retail names like Debenhams, Marks & Spencer and other high street regulars are found along with unusual designer and specialist shops. Take time out to sit and relax in one of the many coffee shops, street cafes, bars, pubs and restaurants that pervade the town and in the evening enjoy the vibrant nightlife including the latest film releases at the Warner Brothers Cinema Park. Sport and exercise is not forgotten with several cricket grounds, tennis clubs, a bowling green, swimming and a 'Fitness First' health club or for more relaxed walks, the Harrow Weald Common and Herriott's Wood with it's deer park are all close by.

Byron Court will offer a contemporary new lifestyle and for those who reserve early, you can stamp your own identity by selecting the kitchen and tiles from a superb range. In addition, they will be fitted with integrated stainless steel oven, hob and extractor chimney! Master bedrooms will feature en-suite, lounges will have digital TV connections, video/audio entry systems will be standard and everyone will get private allocated parking along with added peace of mind of a 10 Year NHBC Warranty.
**All offers are available on selected properties for a limited period only and cannot be combined with any other offers. Strict Barratt terms and conditions apply - please ask for details.

Find out more about both Byron Court and the rental guarantee deal by calling 020 8863 5612.

The Grange in Roxeth Hill
Latest availability: 1 and 2 bedroom apartments

Price range: £264,500 to £464,500

Live in one of Harrow's most sought-after locations. The Grange provides an exclusive collection of homes set in mature landscaped gardens. There will be a variety of designs from conversions of the existing hospital buildings into stunning apartments to three and four bedroom townhouses reflecting the styles of a bygone era, all set behind a gated entrance with uniformed concierge.
The specification gives a real sense of quality. From contemporary fitted kitchens with stainless steel ovens, hob, chimneys and granite worktops to stylish living rooms; with stunning bathrooms and en-suites that have fitted vanity units and heated towel rails to master bedroom suites, some of which also boast a dressing room and all of the homes are pre-wired for satellite TV.
Only sixteen miles from the heart of London, Harrow offers an abundance of entertainment and leisure pursuits. For shopping, Debenhams and Marks & Spencer are amongst the High Street names to be found along with specialist stores, stylish coffee bars and cafes. Harrow also boasts one of the finest collections of state and independent schools.
For getting about, The Grange is ideal. From South Harrow station on the Piccadilly Line, trains run to Leicester Square in around forty six minutes, whilst from North Park NR station trains to London Marylebone take around twenty one minutes. The A40/M40 is also accessible for the national motorway network.

* All offers are available on selected properties for a limited period only and cannot be combined with any other offers. Strict Barratt terms abd conditions apply - please ask for details.
Call 020 8423 8047

And in South Harrow, Barratt is selling The Arc, a collection of one- and two-bedroom apartments. Contemporary one and two bedroom apartments and penthouses, uniquely designed for this location and only fifteen minutes by train from Central London. They will feature a modern spacious interior with a quality specification.
Register now to receive priority information on the forthcoming launch. Simply click on 'Add to brochure requests'.
Central Sales 01923 297 311

Aria is Higgins Homes’ smart collection of just ten one- and two-bedroom apartments in a striking modern building in Newbury Park, Essex.

The location is superb, and prospective tenants will be impressed by the ease of commuting into the capital. Within walking distance of Newbury Park tube station, Aria offers residents a direct journey into the City and West End. The specification is elegant and up-to-the-minute, with kitchens by Urban Myth and featuring stainless steel Smeg appliances, and bathrooms with simple white Ideal Standard sanitaryware,.
The final one-bedroom first-floor apartment is priced at £179,950; there are also two two-bedroom ground-floor apartments priced at £224,950 and £227,950. These prices are less five per cent assisted deposit subject to use of our recommended financial advisors and 21-day exchange of contracts.
The sales and marketing suite is open daily from 10am to 5pm. Contact 020 3022 9009.

George Wimpey South Midlands’ Pages Priory development in Leighton Buzzard presents investors with high-quality properties that offer excellent rental opportunities. Availability includes a range of attractive two-bedroom apartments at prices starting from just £142,950.
These thoughtfully designed apartments benefit from spacious layouts and are all finished to a high standard specification, including double glazing, audio entry system and a fitted kitchen with built-in stainless steel oven, hob, hood and washer/dryer.

Another appealing feature for those in the rental market is the development’s excellent transport links. Tenants want a home that is well-connected to a choice of work destinations, and Pages Priory fits the bill. Leighton Buzzard rail station offers regular services to London and the North, and the A5 and M1 are within easy reach, putting London just over 40 miles away by road.
The development is set in a convenient location just over a mile from Leighton Buzzard town centre, which combines the character of a traditional market town with the convenience of modern-day facilities.

The town benefits from a wide range of amenities a including a wide selection of shops, banks, a Post Office, a library and theatre with cinema, contemporary bars, restaurants, and a leisure centre with swimming pool.

Find out more about Pages Priory by visiting the sales centre, which is located off Johnson Drive and open seven days a week from 11am to 5pm. Call 01525 850949.


George Wimpey South Midlands’ brand new Shrove Meadows development, located in the traditional market town of Olney, Buckinghamshire, offers spacious four-bedroom properties for under £300,000.

The stylish three storey, four-bedroom ‘Gower’ home comprises a large lounge, a kitchen/dining room, four spacious bedrooms – one with ensuite, two family bathrooms, a cloakroom and practical storage cupboards, and is available from £276,995.

Other properties currently available at Shrove Meadows include two-bedroom apartments priced from £167,995, and the five-bedroom ‘York’ and ‘Warrington’ designs priced from £449,995.

The development is located just a mile from the centre of Olney, which maintains its individual character while offering a range of convenient modern facilities including shops, contemporary bars and traditional village inns, as well as health, leisure and education facilities.

The development is less than ten miles from the M1, and just twelve miles from the rail stations at Milton Keynes, Bedford, Northampton and Wellingborough, where there are regular direct services to London.

Further information is available by visiting the Sales Centre, located on Aspreys and open Thursday to Monday from 11am to 5pm, or by contacting the Sales Executive on 01234 714158.

COHABITORS: DON'T PUT YOURSELF AT RISK OF BECOMING HOMELESS

Many unmarried couples living together in privately owned or rented accommodation in England and Wales urgently need to take measures to prevent them from suffering a similar fate to Emmerdale characters Nicola Blackstock and Simon Meredith. They are in the process of splitting up and discovering that cohabiting couples have little automatic legal protection. 
They bought a house together, but it's in his name. Although Nicola has been paying the mortgage on her own, she'll now have to fight to get even a share of the property.  This is in stark contrast to if they had married, when she would automatically be entitled to 50%.

The LivingTogether Campaign, run by legal rights website Advicenow.org.uk, has launched a free downloadable leaflet today (8 February) which offers practical tips to help the 2 million cohabiting couples in England and Wales protect their homes.

The LivingTogether Campaign explains what rights cohabiting couples have and what they can do to safeguard their interests.  The Housing guide offers advice for cohabiting couples in a range of situations, whether they own their own property or rent.

Mary Webber, cohabitation expert at Advicenow says, "Nobody wants to end up without a roof over their heads, or to leave their partner homeless if they die. But unless cohabiting couples make arrangements to protect their rights, and the rights of their partner, then their worst nightmare could come true. Our Housing guide provides practical tips and advice for cohabiting couples in a wide variety of different circumstances."

Mary has some top tips for cohabiting couples:

*    Make a Living Together Agreement (downloadable free from
www.advicenow.org.uk). By agreeing who owns property and possessions at the start, and putting that agreement in writing, you can make sure that you each know what your contributions to the rent or mortgage mean. And it ensures that, if your relationship does end, you will divide things fairly between you, without having to go to court. 

*    Make a will. Without one, your partner won't inherit anything
from you if you die. This is particularly important if you own a property in one person's name or buy a property together as 'tenants in common'. Certain types of tenancy can also be passed on in a will.

*    If you live with your partner in a rented flat but your name is not on the tenancy, you have no right to stay if your partner leaves, asks you to leave, or dies - even if you were paying all the bills.

*    When you sign a new tenancy agreement, it is a good idea to
ensure it is in both names. However, if your partner moves in with you to a flat you are already renting, you may lose more rights by changing the tenancy, than your partner will gain. Get advice about the best thing to do from your local advice centre.

John Bird, 27, is in the process of buying a flat in south London with his girlfriend. They are keen to have somewhere they can call their own. "We read the LivingTogether Housing guide and thought it would be a good idea to draft a Living Together Agreement because you never know what might happen. Now we are both clear about what our rights are, and we've agreed what we would do if we split up".

For further information about your rights as a cohabiting partner and to download a free copy of the housing leaflet please visit www.advicenow.org.uk/livingtogether.

Will HIPs lead to gazumping?

The National Association of Estate Agents (NAEA) has warned that the introduction of Home Information Packs (HIPs) on 1 June 2007 could ultimately lead to a reduction in the number of properties available for sale – which could, in turn, lead to gazumping.
NAEA forecasts that home owners will be more reluctant to put their homes on the market if they will still be liable for the cost of the HIP even if the property does not sell. For many years the UK property market has traded successfully on a ‘no sale, no fee’ basis, it says, with no obligation if the home fails to sell. With the status quo overturned, it argues, home owners may be deterred from selling.
Peter Bolton King, NAEA chief executive, comments: ‘Buyers who are concerned about a lack of properties available from 1 June next year may find themselves in a gazumping situation.
‘There is also an argument that says the HIP could actually make gazumping easier. The objective of the HIP is to speed up the buying and selling process by making all the required information available at the start of the process. The ability for increased numbers of people to have instant access to the HIP could increase the chance of gazumping.’

Immigration boosts buy-to-let demand

Tenants from other countries will play a big role in the buy-to-let market in years to come, according to a new survey from Paragon Mortgages. Paragon’s latest survey of buy-to-let trends has found that almost half of landlords expect that rental demand from non-Brits will increase over the next few years.
Currently respondents have an average of 3.5 non-British tenants, and six times more respondents claim to have experienced rises in demand from non-British tenants than those that have not. Forty-seven per cent of landlords expect to see demand from immigrants increasing over the next few years.

First-time buyers feel renewed urgency

Half of first-time buyers polled in a recent survey for Abbey feel they had better buy quickly before their chance is gone. Prospective buyers voice concern that prices will continue to spiral out of their reach until there is no hope of raising an adequate deposit.
'The proportion of first-time buyers that feel they need to buy now has doubled since last year,' says Barry Naisbitt, Abbey's chief economist. 'However, we would urge first-time buyers not to "panic buy" because purchasing a property is a significant commitment that requires careful consideration.'
When asked what the main obstacles to home ownership were, one-third cited low salaries in comparison to house prices while nine per cent pointed to lack of savings and increased deposit requirements.
Similar research by Halifax showed that it now takes five years for the average person to save for a deposit, compared to three years in 2002 and two years in 1995, while the amount of money needed has increased to £23,967.