Study suggests older home owners would welcome incentives to downsize

Landlords looking to expand

Stamp duty reform could incentivise home owners aged 65 and over in the UK to downsize, freeing up properties for families looking to move up the housing ladder, new research suggests.

Almost a third, some 32%, of those who are looking to sell and buy a smaller property confirmed that a stamp duty cut would be welcomed but the research from equity release advisor Key also suggests that they are other barriers preventing them from doing so.

The research also shows that 63% of estate agents would welcome the abolition of stamp duty for older home owners making a final house purchase.

Overall, the study found that around 620,000 over 65s have looked at downsizing but can’t find a suitable home while another 500,000 have done the sums and found out they wouldn’t make enough money to justify this type of upheaval.

‘When we speak to customers, we find that they are often very attached to their home and their neighbourhood so downsizing is not something they want to consider,’ said Will Hale, chief executive officer at Key.

‘And, if they do consider it, they may well want to take equity release out on their new house as they haven’t made as much as they hoped or they want to make some improvements to make it feel like home. When making these choices, it is vital that they get independent specialist advice as it will help them to fully understand all their options,’ he explained.

‘Making changes to the stamp duty regime would only solve some of the issues that the housing market and the older generation is facing. Serious thought needs to go into this to ensure that we do not create a situation whereby people are pushed into doing something that is not actually in their best financial, emotional and social interests. Guiding customers through their options at this potentially difficult time is critical,’ he added.

Original Source: Property Wire

The top tips for parents to help get your kids on the property ladder

With average deposits for a home in the UK currently weighing in at a terrifying £51.5k – it’s more important than ever to get a plan in place to help your children break into the property market.

With a third of first-time buyers now relying on the bank of mum and dad to get a roof over their head, Reuben Skelton from Oaksmore ISA compiles his 5 top tips on how parents can prepare and give their children the best foothold on the property ladder.

1. Invest for interest

Investing as early as possible is one of the best things you can do to help your children buy their first home. If you’re able to budget and allow for a small percentage of your monthly income to go into a cash ISA this could be the difference between affording that all important deposit, and not. With hundreds of ISAs available to you it’s important to opt for one with the greatest returns that will accumulate a good amount of interest.

At Oaksmore, our IF ISA offers a competitive fixed annual interest rate of up to 7.5% with tax-free payments. At the current rates, investing your annual allowance of £20,000 in a five year bond can accumulate a total of £8,712 in interest alone, bringing your total investment of £20,000 up to an impressive £28,712.

2. Shop around

Everyone loves a deal. Advise your children not to settle for the first property they see but to spend some time shopping around for the best property and value. Buying a home will likely be one of the biggest decisions of their life so far, so it’s important to invest time into getting it completely right. Have them sign up to property e-alerts that will notify them when a new property which meets their specifications becomes available for viewing and iterate the importance of getting in to view quickly. It’s a seller’s market and properties are being snapped up faster than ever.

By that same token, it’s also important to make sure they’re getting the best mortgage possible. If they aren’t confident choosing their own mortgage, a brief consultation with a mortgage broker can be a relatively inexpensive yet practical solution.

3. Opt for a guarantor mortgage

If you’re fortunate enough to be in a position of financial security, a guarantor mortgage can be a superb way of boosting your child up onto the property ladder. A guarantor mortgage simply means that if your child begins to fall behind on their mortgage repayments you, the guarantor, will be liable to pick up the slack until they are able to resume payments.

The benefit of this scheme is that the first-time buyer is able to borrow more or put down a smaller deposit. As the guarantor you will not have any stake in the property in question, nor will your name appear on any of the title deeds, but you must agree to use either your home or a lump sum of savings as a collateral should you then also fail to keep up repayments. As such, this option is best suited to those who are in a more stable financial position.

4. Remortgage your home

Another option is to remortgage your own home to free up a lump sum in cash that can then be put towards a deposit on your child’s first home. For example, if you currently owed £100,000 to your own mortgage lender can be possible to renegotiate your mortgage such that you owe £120,000, therefore freeing up £20,000 in cash.

It’s important to note however, that should you choose to remortgage your home you will have more of your own payments to cover, you will incur arrangement fees and you will be then be paying interest on a higher mortgage rate. These should all be considered before choosing to remortgage as this may affect your retirement plans and the amount of cash freed up in the move.

5. Bring them home

One very simple way to help your children hold onto their hard-earned cash is to welcome them home for a time. Inviting your children back into your home will help cut down on their outgoings including rent, council tax and energy bills.

The average millennial spends £850 per month on living expenses in the UK, so living with parents and investing this money wisely will put them in a great position for putting down a deposit on their first property.

Original source: Property Reporter

Landlords urged to apply for new mandatory HMO licence

“The Government made the announcement about mandatory HMO licensing in January, but we’re concerned that many landlords may not have applied for their licenses.”

With an extension of the rules bringing a wider range of houses in multiple occupation into the mandatory licensing regime coming into effect on 1 October, landlords have just one week to apply for a licence.

This licensing requirement applies to all properties that meet the following criteria:

• is occupied by five or more persons
• is occupied by persons living in two or more separate households
• and meets:
o the standard test under section 254(2) of the Act
o the self-contained flat test under section 254(3) of the Act but is not a purpose-built flat situated in a block comprising three or more self-contained flats, or
o the converted building test under section 254(4) of the Act.

Properties that fall into scope of the new definition but are already licensed under a selective or additional scheme, will be passported over to the new scheme at no cost to the landlord.

However the National Landlords Association is concerned that local authorities are not prepared for, or are still unaware of, the mandatory licensing for HMOs.

Richard Lambert, CEO of the National Landlords Association, said: “The Government made the announcement about mandatory HMO licensing in January, but we’re concerned that many landlords may not have applied for their licenses. We encourage all landlords to make sure they do so before 1 October to be compliant.

“It may be that landlords thought there was a six-month grace period, as was originally proposed. This is not the case and we don’t want to see anyone committing an offence through ignorance.

“We have been contacted by a number of our members who have tried to apply for licenses, but the local authority has purported not to know anything about it or simply didn’t have the systems in place to process the applications.

“This is an unacceptable failing on the part of the Ministry of Housing, Communities and Local Government, which should have ensured all local authorities were up to speed with the changes. It’s disappointing that more consideration hasn’t been made for the significance of this change and the challenges local authorities face in implementing it.

“Our advice to landlords who have encountered this is to apply for an HMO license using the existing process, even if the council hasn’t updated their forms.”

Original source: Property Reporter

The top six tips for a smoother property transaction

They say it’s one of the most stressful things we do, and with several major obstacles to overcome before you get the keys things can unexpectedly grind to a halt, testing the nerves of everyone involved.

However, there are a few things you can do to make the process as stress-free as possible. Here are NAEA Propertymark’s top tips that can help with a smooth-sailing property transaction.

Get organised

Before you even start looking for a property, get organised. You should speak to a mortgage adviser to confirm your budget and get an agreement in principle from them. Then do some research into which areas you can and can’t afford before arranging any viewings.

When your offer is accepted, you’ll get a formal mortgage offer, but remember this will only be valid for a set time-frame, and if you don’t complete on the property before it expires, you’ll need to start the process again.

Don’t sit on things

At the start of the process, your solicitor will probably send a lot of information through to you, and it’s important to review, fill out, sign and return everything quickly and efficiently. Don’t rush anything, but don’t sit on things for two or three weeks as you’ll be holding up the process. Accept that normal life may need to take a back seat until you have exchanged contracts, and make sure you’re fully contactable – even if you’re on holiday.

Choose a first-class solicitor

Your conveyancer or solicitor is crucial to the whole process, so it’s important you’re working with someone you trust. Ask for recommendations from friends or colleagues to ensure your sale or purchase is in good hands.

Communication is key

Keep in regular contact with your solicitor and estate agent so you’re up to speed with what’s going on throughout the process. You might want to agree a weekly update between all parties at the start of the process to reduce the chances of any miscommunication or misunderstandings.

Set a realistic deadline – and stick to it

By agreeing a realistic target date for exchange, everyone has a set deadline to work towards, which should give the whole process some impetus and structure. If one side or both sides aren’t in a rush to move, build in some extra time between exchange and completion rather than being too flexible with the exchange date.

Mark Hayward, Chief Executive, NAEA Propertymark said: “Property transactions occasionally take longer than expected and there is nothing more frustrating for someone who is eager to move, than a delayed transaction. Planning well and managing your own expectations can help mitigate against this and your estate agent should also guide you through the process and keep things moving on your behalf.”

Original source: Property Reporter

How far does London rent money go in the rest of the country?

For the first time in 7 years, house prices are coming down. Despite this, first-time-buyers are still struggling to get a foot on the property ladder and renting remains the only financially viable option for many looking to get their own place.

Renting in London remains the most expensive in the country, with the average renting cost being an eye-watering £666 a week (£2,885 a month) for a whole property. GoCompare have researched properties across the UK and released a 3D 360° tool revealing what type of property the average London weekly renting cost will get you in each London borough and across the country.

Spotlight on London Locations

Westminster – The Royal borough is one of the least spacious areas in the city. The average London weekly rent in this borough offers a 720 sq ft., refurbished 2 bedroom flat, open plan kitchen, with balcony and communal gardens. The area is in the core of the city and offers good transportation links to the rest of the city.

Kensington and Chelsea – Also one of the Royal boroughs, Kensington and Chelsea is widely known as a wealthy borough. Renters could live in a 740 sq ft. ground floor 2 bedroom flat, with a patio – a lot smaller than properties you could rent for less in Barking and Dagenham, Bexley, Havering or Hillingdon. With a maximum of 2 people sharing the small space the weekly rent would be around £333 each or £1,442 a month.

Camden – This borough is one of the most popular and iconic areas in the city. However, for the average £666 weekly rent you could only receive a 647 sq ft., 2 bedroom, 2 bathroom furnished flat with an open-plan kitchen/living room. Camden is one of the areas with the least property spacious however, its music history make of it one of the most vibrant areas too.

Richmond upon Thames – With half of the borough being comprised of parkland, Richmond upon Thames is an affluent area with attractions such as Kew Gardens and Hampton Court Palace. Similar to Kensington and Chelsea, you’ll only be able to afford a 831 sq ft., 2 bedroom flat for the average London weekly rent.

How Does the Rest of the Country Compare to London Space Wise?

Leeds – Still undergoing major development, Leeds has become an attractive location for businesses and housing investment. You could move into a stunning 1,302 sq ft., 3 floor, 7 bedroom house, with 2 bathrooms in a prime location for the average London weekly rent or even less.

Liverpool – Known as a cultural hotspot and boasting a fast growing economy, Liverpool offers great opportunities within the property market. You could rent a 4 bedroom barn conversion, with 3 ensuite luxury bathrooms, 2 garages and a gym in a rural setting for the same cost or less as the above London properties.

Manchester – Manchester has become a popular location for those wanting to escape the extortionate prices in the capital. Despite Manchester’s rising house prices due to ongoing regeneration, the average London weekly rent will still open the doors of a renovated 5 bedroom house, with 2 bathrooms, and garden which translates into a 1,658 sq ft. property.

Sunderland – The 360° tool demonstrates the disparity in size of property between inner London and the rest of the country. For the same price you could move into a detached 5 bedroom house, with ensuite bathrooms, conservatory, garden and a garage in Sunderland. Sharing this space the weekly rent will be around £133 each or £577 a month.

Not only is the average cost of London’s weekly rent extremely high, the difference in property size, build and cost of living is stark between London and the rest of country. Recent statistics show that it is cheaper to buy than to rent across the entire country, but many people are still unable to afford a home due to rising property prices over the years, leaving them with no option but to rent.

Original source Property Reporter:

How much extra are tenants paying for a furnished flat?

How much would you spend to make a rental property feel like home

“Ultimately this research suggests it’s worth calculating the cost of furniture to decide whether the initial financial outlay can be off-set over time during the rental period.”

Renting a two-bedroom furnished flat can cost up to 21% more per month than renting an unfurnished property of the same size in the same area, according to research from property website OnTheMarket.

The cost of furnishing a two-bedroom flat can be around £1,800 including a sofa, coffee table, bookcase, TV, table and chairs, two double bed frames, two mattresses, a desk and an office chair. This amount is calculated based on furniture from IKEA and a TV from Curry’s.

According to the results, renting a two-bedroom furnished property in the city of Sheffield costs tenants an average of £726 compared to £598 for an unfurnished property of the same size – a 21% increase in price.

In Birmingham, tenants will pay £127 more – a 20% difference, in Leeds, there is a 19% premium of £128, and tenants in Manchester and Coventry can expect to pay 15% more.

Other areas included in the research were Newcastle upon Tyne (£85 more – a 14% difference), Glasgow (£86 more – 13% more), London (£128 more – a 9% difference), and Cardiff (£50 more – 7%).

Helen Whiteley, commercial director at OnTheMarket, said: “Ultimately this research suggests it’s worth calculating the cost of furniture to decide whether the initial financial outlay can be off-set over time during the rental period.

“Spread throughout a 12 month tenancy, these costs become around £150 per month meaning it is worth prospective tenants giving serious consideration to whether or not they are embarking on a long term let. That said, there are clear benefits and a level of convenience of walking into a ready-to-live-in property when weighed against the alternative of buying everything yourself.”

Denise Brown, property management manager at Andrew Craig in Newcastle, added: “Newcastle has a strong hold on student accommodation that requires fully furnished because tenants travel to this area for university and do not have many goods of their own.

“Gateshead has more long term tenants and mostly family homes, it is not normally their first rental and the tenants have collected goods along the way.

“Since the Government abolished tax relief for landlords on furnishing properties, we have noticed a significant drop and over three quarters of our management/let-only business is now unfurnished.

“Landlords are more likely to buy rent guarantee insurance, which protects the landlord against the tenants not paying the rent, than furnish properties.”

Original source: Property Reporter

What are the UK’s most popular home improvements?

We are indeed a nation of DIY and home improvement addicts. And, according to a new survey from GoCompare Home Insurance, painting, flooring and a bathroom makeover are the most popular projects to get our teeth stuck into.

According to the data, 68% of the work is undertaken to improve a property’s general appearance rather than essential maintenance 38%. Energy efficiency improvements featured strongly in the list including installing a new boiler or central heating system and improving insulation.

Top 10 home improvements carried out in last 5 years

1: Interior redecoration 50%

2: Replaced the flooring (laid new carpet, wood floor, etc.) 31%

3: Installed a new bathroom 29%

4: Garden makeover 25%

5: New kitchen fitted 25%

6: Installed new boiler or central heating system 25%

7: Fitted new windows/double glazing 21%

8: Installed a new shed or garden building 16%

9: Exterior redecoration 13%

10: Improved the insulation 13%

Just outside the top 10, adding a patio or decking to the garden (9%), electrical rewiring (8%), building an extension (6%), and a new roof (6%) completed the run-down.

Most (87%) homeowners have carried out work on their properties in the last 5 years but only a quarter had spoken to their insurer about their plans or changes they had made. Home insurance policies typically exclude cover for structural alterations, renovations, poor workmanship and faulty materials. So, homeowners tackling major projects they are not qualified to do – such as electrical or plumbing work – could invalidate their insurance.

Before undertaking any major changes to their home, such as adding an en-suite or knocking through rooms, homeowners should consult their insurer to ensure they don’t unintentionally void their policy.

Household building and contents insurance policies generally don’t cover accidental damage to the building or belongings unless cover has been specifically added. So, if a homeowner has a DIY accident while redecorating a room or puts their foot through a ceiling while laying loft insulation, they won’t be covered unless they’ve bought the extra protection.

Analysis of 414 buildings insurance and 428 contents insurance policies by GoCompare Home Insurance revealed that only 16% of buildings and 15% of contents insurance policies include accidental damage as a standard feature. Accidental damage cover can be added to most policies for an additional premium but, a small number of policies (1% of building and 2% of contents) make no provision whatsoever.

Ben Wilson, from GoCompare Home Insurance, comments: “Before undertaking any home improvements it’s a good idea to dig out your household insurance to check whether you’re covered if things go wrong. While you don’t need to inform your insurer about routine decorating or maintenance, it’s a worthwhile precaution to check whether you’re covered for accidental damage.

If you’re planning a major renovation project, particularly if it involves structural changes, one of the first things you should do is to review your buildings and contents insurance to make sure that you have adequate cover both during and after the work has been completed. Otherwise, you could find that you aren’t covered or worse still you might invalidate your policy.

It’s also important to note that most home insurance policies don’t cover tradesmen or their work so, before you employ anyone check they have their own insurance in place. You should also check that any tradesmen you use are qualified to carry out the work and registered with a recognised governing body.”

Original source: Property Reporter

Surge of landlords screening potential tenants via social media

Newly released data from Foundation Home Loans has revealed that savvy landlords are switching to social media to screen tenants before letting them live in their property.

According to the findings, popular sites such as Facebook, LinkedIn, Twitter and Instagram could reveal valuable insight into how they would be as tenants and is the first port of call for an estimated 11% of landlords.

Depending on the accounts available, information that could be gathered from social media could include everything from job and career history right through to friends and lifestyle.

Given one in seven (14%) of landlords say they visit their properties once a month to meet with tenants and make any necessary repairs, a view on the characters living there is evidently important.

However, there are other methods of screening tenants also used by landlords. Just under a third (29%) choose to interview them to help decide whether they are right for the property. Personal references are chosen by 34% as a happy medium, allowing them to understand personalities whilst maintaining a reasonable distance.

Revealing an age difference in how landlords choose to go about their screening, employer references are preferred by more 18-34-year-old landlords (38%) while previous landlord references are valued by those aged 35-54 and 55 and over (41% and 33% respectively).

When it comes to preferences for tenant types, middle-aged couples are singled out by 21% of landlords, with the view that they are less likely to damage the property. This is followed by families with children (16%) as they are more likely to stay in the property for the long-term, and young singles (8%) for the same reason.

Jeff Knight, Marketing Director, Foundation Home Loans, said: “Buy to Let is a business, so it’s only natural that landlords would want to vet their potential tenants just as an employer would a potential employee. While Facebook and social media accounts may not be the best source of information if used in isolation, they can offer valuable insight when set against other checks such as personal references and credit checks. After all, maintaining a good rental income is a priority and void periods can be particularly damaging, so it’s important to ensure this is not a risk when new tenants move in.”

Original source: Property Reporter

Is it logic or love at first sight when buying your home?

With one in two UK homeowners viewing their property just once before making an offer, home builder Countryside has teamed up with relationship expert, John Donlon, to uncover just what makes us lead with our hearts when it comes to buying a new home.

According to a recent survey by Countryside, it took just one visit for 53% of homeowners before purchasing their home, describing the experience as ‘love at first sight’. An additional 25% stated that only a second visit was needed before making a final decision.

John Donlon, commented: “For the majority of people, buying a home is the biggest purchase they will make in their lifetime and so our logic would dictate that many visits, or certainly more than one, would be the norm. That said, our home is the centre of our lives, a place to which our emotions are tied and it is therefore unsurprising that over half of people took only one visit to know that they had found ‘the one’.

Whilst there are a lot of differences between falling in love with a person compared to a property, there are also similarities. We have criteria for both people and houses and it’s our own individual hierarchy of values that provokes an attraction. However, for a person to say ‘I love this property’, what we’re really talking about is attachment. Just as with falling for a person, when we fall in love with a house it’s because it evokes a feeling of affection; it is the thing that has been missing, the place full of possibility where we can see our future.

Falling in love with someone or something is a complex psychological process and there are so many factors at play but a lot of it comes down to the associations we have with that someone or something. For example if a house reminds you of a childhood home or a place that brings back fond memories, this nostalgic wave of affection will play a part. Likewise if we see a house that has features we have seen and liked before, those features will stand out to us.

Of course for some people, buying a house is a logical decision, whilst for others it’s a matter of feelings first. When it comes to couples making a purchase together, it can often be a case of combining both of these qualities and going through a convincement strategy, which makes things interesting! Find a home that meets enough of each person’s criteria and you have an agreement – a ‘we’ experience.”

Anna & Nathan at Countryside’s Wellington Place in Ellesmere Port

When Anna and Nathan’s baby boy arrived in August last year, the couple realised the time had come to begin the search for their perfect family home. House hunting for 12 months, the new parents struggled to find a house that captured their hearts – that is until they stepped into the Show Village at Countryside’s Wellington Place in Ellesmere Port.

Anna said: “We were searching for over a year and just couldn’t find what we were looking for. It’s our first family home so I wasn’t willing to compromise; I knew that when I found our home, I would know straight away. Then one day we wandered past Wellington Place and popped in to take a look. As soon as I saw the Ellesmere house, my heart was set. It just clicked. I love the skylight windows in the kitchen. It feels calm and peaceful and I felt instantly at home.”

Nathan commented: “We viewed a lot of houses before we visited Wellington Place; there were some that ticked a few boxes but nowhere was perfect. Our Countryside home has so much space, it looks out onto the park and the finishes in the house are such a high standard. Above all things it felt like home for both me and Anna. Anna knew first; I think her heart was set straight away, but having now found our perfect home I’d definitely say: when you know, you know!”

Deborah Hughes, Regional Sales and Marketing Director at Countryside, commented: “It has been absolutely fascinating to delve more deeply into the thought processes behind our buyers’ experiences with us. When I think back to buying my first home I know exactly the criteria I had; I wanted a home that was mine where my family would be happy but it’s very hard to put that into words because what makes a house a home is such a personal thing, led by our hearts. Understanding this, and our buyers’ values, is very important part of our commitment to creating places people love.”

Original Source: Property Reporter

Five things prospective tenants may not be aware of

Since May, the number of tenants who are looking for a new home has risen every month. With so many potential tenants entering the market, ARLA Propertymark has compiled their top five facts that the average tenant might not know realise.

You can switch and save

If you’re paying the energy bills, you have the power to switch suppliers. You can often find a cheaper fixed tariff if you shop around, so it’s worth taking the time to do so. Double check your tenancy agreement as some contracts include a clause which means you need to inform the landlord, but feel empowered to switch.


Landlords usually aren’t happy for tenants to start redecorating their properties – but there’s no harm in asking. You need to seek permission to install extra shelving, hang things off the walls, or anything which could damage the property. You’d also need to ask if you’d like to paint anything, or replace the units, etc. There are however, lots of things you can do to make your rental house feel like home without your landlord’s permission. An eye-catching floor lamp can change the whole feel of a room and laying down rugs will keep the floor intact while letting you personalise the space. You could also buy scatter cushions and throws, and make sure you always have a vase full of fresh flowers on the kitchen table.

Letting with a pet

If you have a pet, it’s really important to be upfront about it when you’re looking for a property. Some landlords won’t allow them at all, but many will be fine with pets if you pay a higher deposit to cover any potential damage – just make sure this is clearly stated in your contract if you agree to it. If you find a property and the landlord won’t allow pets at all, your letting agent can help you find another suitable one.

Smoking cannabis is not permitted

Cannabis is illegal in the UK, and there will probably be consequences if you’re caught smoking it behind closed doors. There’s usually a specific clause in rental contracts which says tenants must not consume illegal substances in the property, and subject to the landlord’s consent, most contracts prohibit any smoking in the property at all.

Running a business

Although it is legal to run a business from a residential property, you must ask your landlord for permission if you want to do so; but remember, there are various things they will need to consider before agreeing. They would probably have to inform their mortgage provider, as well as getting permission from the freeholder if the property is in a block of flats. They’d need to update their insurance, and make sure they are not breaking any licensing conditions the local authority has placed on the property too. General wear and tear could also be an issue if the business wasn’t just desk-based, and they need to make sure the business wouldn’t disturb neighbours if people are coming and going throughout the day.

Peter Savage, President, ARLA Propertymark comments: “Finding a rental property can be a stressful task, especially if you’re unfamiliar with all the clauses in your tenancy agreement, but it can also be really exciting. The most important thing to remember is that once you sign the tenancy agreement and move in, you’re still bound by it. While most landlords are very willing to negotiate, these discussions do need to take place and you should never assume your landlord won’t mind without some sort of commitment in writing. Letting agents can help you both with understanding the small print in your contract and by helping you negotiate directly with the landlord.”

Original Source: Property Reporter