Property positives & negatives: what puts buyers off?

For many, selling up represents a decision to leave a property that the owner has invested time and money into making it a home. Others, however, may have fallen out of love with where they live, letting it get a little ‘rough around the edges.’

Like or loathe your current home, it’s not the opinion of the seller that counts. As soon as that ‘for sale’ sign is up, all that matters is what buyers think about the property and how much they’re willing to pay to make it theirs.

New research from Tapi was commissioned to establish the top five negatives that put potential purchasers off. It’s a study that has been carried out numerous times by different people but after the last two years and many people making lifestyle changes, it’s good to get a fresh perspective on what may scupper a property sale.

The research found a home that needed a lot of work doing to it was the most off-putting aspect, with 45% of those taking part in the research saying they’d pass on a property if it needed too much modernising or maintenance.

On a similar theme, 22% of participants commented that they’d discount a property that needed complete redecoration, while 28% would be deterred if the home had an old kitchen that needed replacing.

The other two aspects in the top five property negatives really fall outside of the seller’s control. Purchasers value their peace and quiet, with 43% of respondents saying they’d snub a property if there was a lot of external noise pollution. Completing the list was unsightly surroundings in eye view of the property – a negative cited by 36% of people.

Rather than dwelling exclusively on the adverse, the study also asked what people found most attractive when looking for a new home. Unsurprisingly, more than half of Brits (52%) said private outdoor space was the most important factor when searching for a new home.

Just behind a garden or a balcony was a new kitchen, with 51% saying this was a top consideration when looking for a property to buy. Another feature that finds favour with home movers is a new bathroom, with 42% of respondents saying this was very important to them. Other property plus points included freshly painted walls (20%), new flooring (15%), modern appliances (12%) and neutral colours (19%).

Before you rush out to buy a new kitchen or rip out your bathroom, talk to us about the financial investment needed to make improvements versus the actual value and appeal it will add to your property. Sometimes the simplest (and cheapest) alterations, such as tidying the garden and repainting throughout in white, can make all the difference. Contact us for free advice and a property valuation.

June’s property market analysis

We’re almost halfway through 2022 and there is time to reflect on the current property market. Although the interest rate has risen, the impact has yet to hit buyer demand, with buyer numbers still high. Estate agents participating in Propertymark’s latest study reported an average of 100 purchasers registered per branch.

There is, however, a contrast between buyer demand and the number of properties for sale. This recurring theme was illustrated in the same Propertymark study. It found there were 52% fewer properties available in April 2022 compared to the same month in the previous nine years.

Sellers shelling-out over the asking price

Competition between buyers remains fierce – an aspect that should encourage sellers to come to market. As a result of demand, purchasers are willing to bid high to secure a property. In fact, 39% of agents say the majority of their stock sold above asking price.

House prices continue to rise

Rather than a cooling market that property commentators had predicted, the rate at which house prices are climbing accelerated in May. Previously, growth had shown signs of slowing, dropping to 0.3% in April from 1.1% in March.

May, however, saw the growth rate of price rises bounce back. The Nationwide detailed a 0.9% uplift in property values – the tenth month in a row where values had increased. Annual price growth now stands at 11.2%.

Rising property values have also led to a new property record. In May, Zoopla’s house price index revealed the UK’s average house price had topped £250,000 for the first time. Demand that’s 61% over the five-year average and a 37% dip in the number of homes for sale have combined with a willingness to pay over the asking price to create a new average house price of £250,200.

The residential side of agency isn’t the only place to have experienced increases. Goodlord’s May rental index shows that rents rose by 0.83% in May. This results in English tenants paying a new average monthly rent of £1,020. Rents are now 11% more expensive when compared to a year ago.

Potential buyers have two pieces of news to digest this month. The Government stunned the property industry by announcing a change to its Help to Buy scheme. The Government has brought this deadline forward, with Help to Buy purchasers needing to reserve a property before 6pm on 31st October 2022 It had been advertised that reservations needed to be made by December 2022.

There are successors to Help to Buy

The earlier reservation deadline will ensure all sales legally exchange before Help to Buy ends in March 2023. Anyone hoping to buy a new home using the scheme – which allows purchasers to buy a property with a 5% deposit – should not delay their property search. Alternatives still running after Help to Buy ends include the Government-backed mortgage guarantee scheme, shared ownership and First Homes.

Those who are buying a property in the near future are being advised to pay particular attention to their circumstance. A new poll among 940 estate agents looked into who was to blame for sales falling through. Respondents said 46% of collapsed sales were due to problems on the buyer’s side, with 22% saying purchasers further up or down the chain caused issues.

Fallthrough rates remain low

Conveyancers and solicitors, however, didn’t escape the wrath of estate agents. Of those questioned, 17% found it was the legal teams who were behind transactions that failed to complete. Thankfully fallthrough rates are low. Almost 3 out of 4 agents taking part in the research (70%) said fewer than 9% of their sales fell through.

The property sector loves a study and the latest English Private Landlord Survey found 90% of landlords plan to keep renting out their buy-to-lets after their current tenancy agreement expires. When it comes to adding properties to their portfolios, 11% of landlords said they plan to purchase additional buy-to-let.

If you would like to know more about your local property market, please get in touch.

5 things landlords should know about green mortgages

From what was a leftfield way of thinking to a mainstream, everyday goal, going green is an agenda-topping issue in lettings. Green mortgages can help landlords reduce three vital aspects – carbon emissions, fuel bills and mortgage repayments – by incentivising the purchase of the most eco-friendly homes and encouraging the upgrade of the least energy efficient rental stock.

Here are five green mortgage must-knows:-

  1.     Landlords can apply now

Green mortgages, with their more attractive interest rates and borrowing terms, aren’t reserved exclusively for those buying a property to live in themselves. In fact, 15% of the buy-to-let home loan market is devoted to green mortgages, with product numbers at their highest ever level (there were more than 350 green buy-to-let mortgages available as of April 2022).

  1.     The property you’re buying should have a top-end EPC

Green mortgages are offered to buy-to-let investors who are purchasing the most energy efficient properties to rent out. To qualify, there should be an EPC with a rating of A, B or C. It is a legal requirement for every property for sale to have a valid EPC but if you’re in any doubt about the eco performance of any property you want to invest in, please ask us for advice.

  1.     Alternatively, you should be committed to making eco improvements

There is good news for investors who have found a high yielding property that happens to have an EPC of D or below. Some green buy-to-let mortgages are aimed specifically at investors willing to install upgrades to improve the home’s EPC rating. These incentives come in the form of cashback that can be spent on improvements, or a bridging loan that can be converted into a buy-to-let mortgage after work to improve the EPC rating is complete.

  1.     Now is a good time to take out a green mortgage

Whether you are making your first property investment, remortgaging a buy-to-let in your portfolio or are adding something new to your rental collection, considering a green mortgage now is a wise move. With the interest rate creeping up, any home loan that offers an advantage makes business sense, especially if it encourages landlords to install energy efficiency measures.

  1.     Green mortgages & EPC changes go hand-in-hand

The timing of green mortgages is critical, given the EPC changes that lie ahead. Landlords should be preparing now for 2025, when all new and renewing tenancies need to have a C EPC rating. This new standard will also apply to existing tenancies from 2028, and the mandatory expectation may even rise to a B by 2030.

Get in touch if you’re going green

Green mortgages should be the incentive you need to start making energy efficiency changes to a buy-to-let you own or intend to buy. From attractive interest rates and cashback to larger loan amounts to cover eco improvements, what’s not to like? We can help with planning and managing a more sustainable buy-to-let, so contact us today.

The eco improvements that add the most value

If there’s one agenda that won’t be pushed to the bottom of the pile, it’s the eco agenda. How much energy we use, where we get our energy from and what we can do to reduce our carbon footprint is a narrative that has become persistent in the property market.

While most of us acknowledge that building and running homes contributes to harmful emissions (it’s estimated that 40% of the UK’s carbon is emitted by households), the type of improvements that make the most positive contribution to a greener planet are sometimes the most intrusive – and expensive.

So where does this leave the homeowner who wants to improve their eco credentials but has potential plans to move in the near future?

The good news is adding energy efficiency measures may increase the value of your property and make your home more desirable to buyers when it comes to selling – on top of any gas and electricity savings you make while living in the property once any changes are made.

Which eco improvements add the most value? 

Rated People helpfully ranked 15 of the most common energy efficient home improvements in order of how much value they add to a property, as follows:

  1.     Solar panels – £13,512 (value increase)
  2.     Wind turbine – £12,941
  3.     Triple glazing – £12,788
  4.     Underfloor heating – £12,290
  5.     Ground source heat pump – £12,251
  6.     Double glazing – £12,005
  7.     Extra insulation, like cavity wall insulation – £11,764
  8.     Biomass boiler – £11,756
  9.     Air source heat pump – £11,670
  10.     Solar water heating – £11,646
  11.     Electric car charging point – £11,538
  12.     Green/living roof – £11,477
  13.     Biodiverse garden – £11,444
  14.     Old appliances replaced with new ones – £11,190
  15.     Draught proofing – £11,151

How much do the most popular eco improvements cost?

Air source heat pump: expect to pay in the region of £10,000 for the purchase and installation of an air source heat pump. This cost can be reduced significantly if homeowners act quickly. The ‘first come, first served’ Boiler Upgrade Scheme offered by the Government will reduce the bill by £5,000 and there’s zero VAT on the purchase of heat pumps until 2027. 

Verdict: you may just about break even when balancing added value with purchase/install costs but if you take advantage of the Boiler Upgrade Scheme and zero VAT, you’ll potentially add £5,000 in value.

Solar panels: figures will vary according to the size and type of your property, along with the model you opt for. As a general guide, the supply and installation of solar panels will set you back around £5,000–£10,000, although the purchase of the panels will be VAT free for the next five years. 

Verdict: install solar panels in the next five years to take advantage of zero VAT and this installation could add in the region of £5,000 to your home’s value.

Electric vehicle charging point: expect to pay anywhere between £800-£1,100 to buy and install an electric vehicle charging point at a domestic property. If you’re a homeowner who lives in a flat, you’ll be able to apply for the Government’s new ChargePoint grant, which offers a 75% discount on the cost of purchasing and installing a charging point, up to the value of £350.

Verdict: installing an electric vehicle charging point is by far the most lucrative eco improvement. An outlay of around £1,000 could see you add another £10,000 in value to your property.

If you are thinking of selling a property you own, contact the team for advice and a free valuation.

Landlords: claim 75% off an electric vehicle charging point

Another week and another Government initiative to help us meet its goal of being carbon net zero by 2050.The new scheme is aimed specifically at landlords who want to improve the eco-credentials of their buy-to-lets.

Called the ChargePoint grant, the initiative is not brand new – instead it replaces the Electric Vehicle Homecharge Scheme. The new grant invites landlords to apply for a 75% discount on the cost of purchasing and installing a home electric vehicle charging point, up to the value of £350. There are, however, a few caveats to note. The landlord must own the parking area and be VAT registered or registered at Companies House to be eligible.

Landlords who don’t engage in this Government initiative may find their buy-to-let gains an electric vehicle charging point anyway, as a related scheme gives tenants in rented flats and single-use accommodation access to a similar grant. In this case, the charge point installer applies for the grant on behalf of the tenant, with the discount coming off the tenant’s final installation bill. Again, there are conditions. The tenant must own, lease or have ordered a qualifying electric vehicle and prove there is dedicated off-street parking at their property.

The tenant-driven scheme is also a way for landlords who don’t meet the VAT or Companies House standard to benefit from the discount, by encouraging tenants to apply for the grant instead.

Under 41s are prioritising eco aspects

New research conducted by E.ON among Gen Z (aged between 16-27) and Millennials (aged between 28-41) has revealed electric vehicle charging points to be high up on the home moving agenda.

Over three quarters (77%) of Gen Z said eco aspects, such as an electric vehicle charging point installed or a heat pump, were a priority when searching for a new home to buy or rent. In addition, four in five people (81%) aged between 16-41 would pay a higher price for a property if it had an electric vehicle charger, a heat pump or solar panels.

When it came to electric vehicle charging points specifically, 62% of Gen Z renters and buyers placed great significance on this aspect, while 80% of Gen Z and 78% of Millennials said they’d disregard properties that didn’t meet minimum energy efficiency ratings.

More electric cars are being sold

Landlords need to accommodate rising ownership of electric cars – 1 in 5 UK cars sold to date in 2022 is an electric vehicle, according to data from the Society of Motor Manufacturers and Traders.

Sales are expected to accelerate in the coming months as the choice of electric vehicles in the UK market expands. Currently there are more than 140 different electric models to choose from, with another 50 planned by the end of 2022. This compares to just nine electric models in 2011.

Full details about the ChargePoint grant for landlords can be found on the Government’s website, or contact us if you are thinking of making any eco modifications to your buy-to-let.

How to style your home with books

While photo frames, fresh flowers and candles are more common finishing touches, styling with books is a novel (excuse the pun) way of completing an interior makeover.

Designers have often used hand-picked books as props when dressing show homes but the art of primping with paperbacks really went mainstream during recent lockdowns.

The Zoom months gave birth to a new design movement, which you can find all over social media if you search #bookcasecredibility. It refers to the careful editing of your bookshelves in case people on video calls are scrutinising the book titles behind you.

The right reading matter is now such an issue that in April 2022, singer Adele reportedly rushed out and bought £1,000 worth of books to create a library behind her ahead of future Zoom broadcasts. It was a similar story for actress Ashley Tisdale, who confessed to buying 400 books ahead of a photoshoot at her home. The good news is styling with books is the interior design trend that everyone can follow, with most of us already having a head start.

If you already have a bookshelf, merely organising it will create a more polished look. Neaten up your act by displaying books in height order, from left to right, or for an unconventional but still organised approach, lay piles of books flat, working from bottom to top in size order.

For something more design-led, organise the spines according to their colour. Creating a rainbow is a trend that’s gaining traction on Instagram  – search #rainbowbookcase for ideas. Don’t forget a sparse bookshelf can be pepped up by using bookends, plants or other objet d’art to fill the space. Just ensure anything displayed is kept dust free.

If you’re starting your book display from scratch, you may want to follow a theme. One of the easiest to achieve is a gentleman’s library – especially if the room you’re working on is panelled or painted in rich colours. Scour charity shops and boot fairs for leather-bound books, especially those with gold printing on the spine.

Reluctant readers and those who really don’t like clutter can still incorporate books into their interior design. A neat stack of books is a good way to create interest with different heights. Something to try is a pile of three similarly-sized books on a sideboard, with a table lamp placed on top. Show off the book spines if they feature interesting fonts or if the book titles convey a theme,  or hunt out hardbacks with gilded pages, as flashes of gold can add a touch of luxury.

Finally, the world of coffee table books is alive and well. A curated collection of two or three large format, hardback books – casually left out or even open – can speak volumes about the lifestyle you want to purvey. The traditional themes of haute couture fashion, photography, travel and architecture are still favoured and Glamour Magazine has done the hard work for you by creating a list of 43 coffee table books selected for their aesthetic appeal.

If you are thinking of moving for more space to display your books, contact us for advice and available properties.

Should you aspire to be chain free?

A state-of-the-art kitchen?  A spacious garden with an outdoor room? A home office with the fastest broadband speeds possible? You may think you know what adds value to a property but a new report reveals that being chain free is one of today’s most valuable aspects.

Data analysis by HBB Solutions found that a chain-free home carries an average property price premium of £23,131, with buyers willing to pay extra for a simpler and quicker sales transaction.

Being in a property chain is one of the downsides of moving home, as sellers are dependent on the speed and efficiency of others above and below them. Therefore, the fewer people involved in a chain, the better.

Increase the appeal of your property

There is monetary value attached to being a chain-free seller but are there any other advantages? Advertising a property as ‘chain-free’ certainly appeals to buyers, as they know this reduces the risk of delays to the transaction and a potential chain collapse above them. In fact, Rightmove recorded a 72% increase in the number of buyers including “no chain” in their search terms in 2021, so it’s fair to say a chain-free home will often be favoured over those with long, complex chains.

Conveyancing can be much quicker

With fewer people to coordinate in a chain, the conveyancing process will, naturally, become more straightforward and speedier. This advantage has actually been measured; it was found the conveyancing attached to a chain-free property was reduced to 4 weeks – down from the average of 10.

Perks of being a chain-free purchaser

Just as no chain above is very appealing to buyers, sellers also appreciate the simplicity of dealing with a purchaser who doesn’t have a chain below. In a seller’s market where multiple offers may have been made on one property, a chain-free buyer can edge out the competition thanks to having no one else behind them to complicate the transaction.

How to become chain-free

If you’re a first-time buyer, you will naturally be chain-free and a good prospect among sellers but what if you have a property to sell? One solution is to sell your property and move into short-term rented accommodation to break the chain. Not only will this make you the end of the chain when selling, you will also be chain-free when it comes to buying again.

Sellers can also commit to making their onwards purchase a chain-free property, which will cap the chain, or they can consider buying a brand new home where there will be no other transactions above.

If you can’t be chain-free…..

It’s estimated only 10% of homes listed for sale are offered on a chain-free basis, giving you an idea of how hard it can be to achieve this cult status. Thankfully, there are other ways sellers can give themselves an advantage in a competitive market:-

  • Choose an estate agent with a proactive sales progression programme, with staff who will chase other agents, solicitors and movers involved in the chain
  • Be ready to start your property search as soon as you’ve accepted an offer on your property
  • If you need extra finance to purchase your next home, ensure this is approved before the ‘for sale’ board goes up
  • Have a conveyancing solicitor instructed and ready to proceed at the same time as you appoint an estate agent

Thinking of selling your home? Contact us to discuss your plans and the possibility of becoming chain-free.

Elevate your property with portable changes

Whether you’re a fan of interior design TV shows, spend hours scouring the internet for the latest trends or like nothing better than hitting your local homeware stores, many of us love improving where we live.

The problem is, some of the most eye catching home additions are permanent, expensive or both. While there is no doubt that replacing an old kitchen or installing a new bathroom will transform a property, it’s not a practical path to follow for tenants or for soon-to-be sellers who want to give their home added appeal without blowing the budget.

The good news is there are some really clever – and portable – ways of improving your property. The emphasis here is on items that can be moved from property-to-property. After all, if you’re shelling out to improve the aesthetics of your home, being able to pack the items up and take them with you makes sense.

Our four portable product recommendations will give you a good return on investment, whether you’re looking to impress buyers or elevate your everyday home style. There’s no need for planning permission, permanent alterations or a trade professional and even better, our suggestions are easy to source on the High Street, online or even in larger supermarkets.

Textiles can come to your aid when perking up your property. The upholstery side of improvements, such as replacing sofas and armchairs, represents a serious outlay but entry-level soft furnishings can transform how a room feels. The holy trinity of rugs, cushions and throws remains the quickest and cheapest way to make an impact – choose a single colour or theme for the wow factor.

Lighting is another portable asset that can dramatically alter the perception of a property. Plug-in table and floor-standing lamps can be used to banish shadows, while a string of humble battery-operated fairy lights never fails to cast a magical glow.

Lights can also be employed to set the scene outside. There are a myriad of solar options on sale, from hanging lanterns to simple stake lights. In fact, creating illuminated garden rooms is one of the most desirable and portable trends for 2022. Everything you’ll find in a living room now has an outdoor, weatherproof counterpart – sofas, rugs and even freestanding lamps. As long as you don’t screw it down or cement it in, outdoor items can move with you.

There’s one other recommendation that straddles both inside and out: plants. Staying in the garden, it’s not wise to waste time and money on shrubs, bulbs and trees that you plant directly into the ground. Instead, pots and baskets can be placed where needed, then packed onto the back of a removal lorry.

House plants are another portable winner and are definitely a shrewder investment than the classic advice of adding colour to your home with cut flowers. Whereas a bunch of blooms will be destined for the compost bin within days, house plants can live for years if cared for.

If you’re looking to move in the next few months, contact our team for advice and the latest local market report.

5 value-adding ideas to help achieve your asking price

While it’s universally accepted that, in many circumstances, the price we pay is the price we see – in supermarkets and restaurants for example – there are a couple of instances where a little haggling is to be expected.

Buying a property is one of them. After all, estate agencies are staffed with skilled negotiators and the clue is in the name. Even in the strongest selling market, buyers may offer a figure below the asking price, hoping the seller will say yes in order to secure a sale.

As a guide, we traditionally see buyers offering up to around 5% less than the asking price on their first bid. The longer a property is on the market, the more likely an offer will be 10% under what the property is marketed for. There’s even such a thing as a ‘lowball’ offer – a figure that’s 25% or more below the asking price, but this is highly unusual.

As experienced agents, we understand your need to achieve as close to the asking price as possible but what happens if you come across a buyer who drives a hard bargain? A keen purchaser who repeatedly submits low offers shouldn’t always be dismissed.

They may be an excellent prospect in terms of their circumstances – perhaps a cash buyer, someone with no chain behind them or a purchaser who can offer a quick exchange – and we’re here to help you weigh up a person’s situation versus their offer.

If low offers persist but you are worried you may lose the interest of potential purchasers, there are ways to keep buyers engaged without budging on your asking price. It all comes down to adding extra value.

Here are 5 value-adding ideas to explore:

  1. Sell with planning permission already granted: the cost of submitting a full planning permission application for alterations/extensions to a single dwelling house or a flat is £206 but it could add as much as 10% to your home’s value.
  2. Leave behind high-value items, such as white goods: fridge freezers, ovens and even furniture can all be used as bartering tools. If this approach appeals to your buyer, ensure negotiations are conducted through the solicitors using the TA10 contents and fixtures form.
  3. Be flexible with the completion date: value can’t always be measured in monetary terms, so being in a position to exchange and complete at speed will be an advantageous trade-off tool among buyers who are in a hurry.
  4. Offering to rectify flaws found in the survey: one of the most common reasons for a low offer is unfavourable survey results. Offering to pay for issues such as damp is a cost but it could allow you to stick to your asking price – a critical point when funding an onward purchase.
  5. Throw in extras: there’s definitely something in the concept of buying a lifestyle so if your purchaser has fallen in love with your home, they may be persuaded to up their asking price if you include accessories such as lamp shades, curtains and rugs.

If you are hoping to come to market this spring, why not start with one of our free valuations? We will suggest an achievable asking price and advise on ways that you can add value to your home. Contact us to get started.

Taxing matters for landlords in 2022

‘Tax doesn’t have to be taxing’ is a favourite slogan of HM Revenue & Customs and it’s true! For many people, paying tax and working out VAT is an aspect of our daily lives that someone else works out on our behalf.

If you’re a landlord or property developer, however, you are classified as a business owner who is responsible for their own tax bill and possibly VAT too. While a good accountant is vital when it comes to filing returns and reducing bills, understanding the relationship between tax, VAT and property before you invest and during a tenancy is key to healthy yields and profits.

This year will see landlords settle into a new tax and VAT pattern, and while we can’t predict what the Chancellor may introduce later in 2022, here are 6 things we do know:

Mortgage interest tax relief changes are in full effect
The tapering of mortgage interest tax relief is complete and from now on, landlords filling in their self-assessment tax return will only be able to offset 20% of their mortgage interest payments against their tax bill.

There’s more time to report & pay CGT
When a landlord sells a buy-to-let property, there is usually CGT (Capital Gains Tax) to pay. This year has already heralded a positive change to how landlords report profits gained from selling additional properties and how long they have to pay the CGT bill. The timeframe has been extended to 60 days, up from the previous 30.

The tax liability notification period may shorten
The Government is keen to boost its coffers and it is consulting on an Income Tax Self-Assessment reform, which would prompt landlords to pay taxes due more quickly. At present, landlords have six months to notify HMRC of a tax liability if they’re making money from additional properties but this timeframe may be reduced to something much shorter, possibly one month.

Stamp duty may rise for mixed-tenure purchases
Property investors with one eye on the High Street should plan for a possible SDLT (Stamp Duty Land Tax) hike. The Government wants to change how mixed-tenure purchases – such as a ground floor retail unit with a residential flat above, sold as one transaction – are taxed. Currently, purchasers pay lower commercial rates of SDLT on the entire purchase but the proposed change would see the residential part taxed at the higher residential rate.

5% VAT for developer landlords is available
Landlords who engage in development and conversion work before they let out a property still have access to more flattering rates of VAT. Building work to change a commercial premises into a residential buy-to-let home may attract 5% VAT, while developing student accommodation could see VAT reduced to zero in some cases.

Reduced VAT rates for providers of holiday accommodation ends soon
One of the Government’s pandemic rescue packages saw suppliers of holiday accommodation – including short Airbnb lets – pay a reduced rate of VAT but this benefit ends on 31st March 2022. As of 1st April 2022, the VAT rate will rise from 12.5% to the pre-pandemic standard rate of 20%.

Still find tax taxing?
As buy-to-let and property specialists, we can advise on all matters of lettings, including tax and VAT. Get in touch and we can help you find financial efficiencies and run profitable property investment portfolios.