A. You may well ask! Changes to the rules governing EPCs were supposed to be implemented last July, and then in October. Both dates came and went without any sign of the changes happening – and with precious little explanation of what (if anything) was going on.
Currently, a new version of the EPC, and new rules governing their use, are meant to come into force on 6th April – Good Friday. However, at the time of writing, with only some 5 weeks left to go, the whole thing still seems to be up in the air. Detailed guidance from CLG (the Department of Communities and Local Government) is promised well in advance of the date, but there are currently no clues as to what that guidance might be. It is even rumoured that the new version of the EPC hasn’t even been approved yet!
In practical terms, this is probably more of a worry for us estate agents than it is for the general public, since one of the proposed changes is that in the case of sales, we will become legally responsible for EPCs, and face censure and even have to pay fines if the new rules governing their production and use are broken - yet we are almost completely in the dark about what’s going on!
Ultimately, however, the really big question is whether any of these changes will make EPCs more useful than they have so far proved – and on this, I suppose the fairest thing to say is that the jury is still well and truly out. The official line, of course, is that anything which increases awareness of the energy efficiency and environmental impact of a property has got to be a good idea. But so far, there is precious little evidence to suggest that buyers actually care very much. After all, there is a lot more to choosing a home than the cost of heating it. Very few buyers are showing signs of rejecting properties that they like and can afford, simply because they have a “G” energy rating.
Of course, this may change as we all become – or are forced to become – greener. However, that day is still a long way off.
Tuesday, 6 March 2012
Monday, 27 February 2012
Q. In his will, my late father left me a sizeable lump sum, which I want to put to work. Is buy-to-let a viable option?
A. Absolutely, yes! In fact, after a bit of a slowdown in the immediate aftermath of the credit crunch, the buy-to-let sector is booming once again.
Why? Well, the main reason is that with the continuing national shortage of housing stock, demand for rental property has soared. Research shows that with the size of deposit required by lenders forcing many young people to postpone buying their own home, the majority of newly-formed households are now more likely to be in the private rental sector.
This massive surge in demand, which shows no sign whatsoever of tailing off in the foreseeable future, has in turn driven up rental values right across the country. And this against a background of lacklustre performance by most of the more traditional investment alternatives – a factor highlighted by the turmoil in world stock markets over the last couple of years. In 2011, for example, the yields from buy-to-let property (i.e. rental income as a proportion of the purchase price) averaged 5.4% - the best since 2003. In contrast, the FTSE All-Share Index yields 3.8%, UK Government pay 2% and the Bank rate is just 0.5%!
As a result of all this, lenders have been returning to the market in a big way. A recent article in the national press reported that the average interest rate on a buy-to-let loan dropped from 5.31% to 4.79% over the last two years. During the same period, the number of deals available doubled. The typical deposit required has also fallen back from 35%-plus to 25%. There are even some deals that only ask for 20%.
At the same time, however, lenders have clearly learned some lessons. So, for instance, whereas in the bad old days you could easily secure a B2L mortgage solely on the basis of the expected rental income, lenders now typically require you to be able to prove that you have an additional source of income of at least £25,000 a year. Which, when you think about it, is no bad thing.
Finally, add in the fact that prices are currently the lowest they’ve been for years, and this is arguably the best time ever to invest in property!
Why? Well, the main reason is that with the continuing national shortage of housing stock, demand for rental property has soared. Research shows that with the size of deposit required by lenders forcing many young people to postpone buying their own home, the majority of newly-formed households are now more likely to be in the private rental sector.
This massive surge in demand, which shows no sign whatsoever of tailing off in the foreseeable future, has in turn driven up rental values right across the country. And this against a background of lacklustre performance by most of the more traditional investment alternatives – a factor highlighted by the turmoil in world stock markets over the last couple of years. In 2011, for example, the yields from buy-to-let property (i.e. rental income as a proportion of the purchase price) averaged 5.4% - the best since 2003. In contrast, the FTSE All-Share Index yields 3.8%, UK Government pay 2% and the Bank rate is just 0.5%!
As a result of all this, lenders have been returning to the market in a big way. A recent article in the national press reported that the average interest rate on a buy-to-let loan dropped from 5.31% to 4.79% over the last two years. During the same period, the number of deals available doubled. The typical deposit required has also fallen back from 35%-plus to 25%. There are even some deals that only ask for 20%.
At the same time, however, lenders have clearly learned some lessons. So, for instance, whereas in the bad old days you could easily secure a B2L mortgage solely on the basis of the expected rental income, lenders now typically require you to be able to prove that you have an additional source of income of at least £25,000 a year. Which, when you think about it, is no bad thing.
Finally, add in the fact that prices are currently the lowest they’ve been for years, and this is arguably the best time ever to invest in property!
Friday, 17 February 2012
Q. I’m thinking about selling. Given the state of the market, is it worth running an Open House?
A. Open Houses can be a valuable addition to your armoury, whatever the state of the property market – but probably even more so at the moment, when sellers and their agents are having to work that much harder to generate buyer interest.
And generating buyer interest is what Open Houses are very good at. Unlike the more traditional viewing procedure, where potential buyers first have to register with the agent and then book an appointment to view, they give house-hunters the opportunity to take a really good, long look at a property, both inside and out, without having either the owner or the agent constantly at their elbow. In other words, it’s a bit like visiting a stately home and taking your own time over it, rather than having to take a guided tour!
In addition, research in the USA, where Open Houses have been used for years, shows that when more than one group of buyers look at a property simultaneously, it can help to create a sense of competition – so prices achieved are often actually higher than they might otherwise have been.
Of course, the idea of throwing your home open on a particular day between set times, so that it can be viewed by a whole bunch of complete strangers, can sound a bit scary. But it needn’t be, because a good agent will help you with all the arrangements.
Those arrangements can vary according to your own preferences – so the first thing is to agree a plan of action with your agent. You may, for example, prefer to have the whole thing handled relatively discreetly. Or, you might decide to go for broke, put an “Open House” sign in the window, and hang balloons and bunting all round your front garden, so that no-one is left in any doubt about what is going on! Either way, your agent will ensure that details of the event – which for obvious reasons will normally be scheduled for a weekend - are widely advertised in advance.
Meanwhile, all you need to do is make sure your home is looking its best, and that any items of value are safely locked away. Then, it’s just a mater of waiting to see who turns up on the day, making a note of their names and contact details, and leaving them to look round at their leisure.
Of course, as with anything else, there are no cast-iron guarantees that an Open House will deliver the goods. But particularly in the current market, that extra string to your bow could just make all the difference!
And generating buyer interest is what Open Houses are very good at. Unlike the more traditional viewing procedure, where potential buyers first have to register with the agent and then book an appointment to view, they give house-hunters the opportunity to take a really good, long look at a property, both inside and out, without having either the owner or the agent constantly at their elbow. In other words, it’s a bit like visiting a stately home and taking your own time over it, rather than having to take a guided tour!
In addition, research in the USA, where Open Houses have been used for years, shows that when more than one group of buyers look at a property simultaneously, it can help to create a sense of competition – so prices achieved are often actually higher than they might otherwise have been.
Of course, the idea of throwing your home open on a particular day between set times, so that it can be viewed by a whole bunch of complete strangers, can sound a bit scary. But it needn’t be, because a good agent will help you with all the arrangements.
Those arrangements can vary according to your own preferences – so the first thing is to agree a plan of action with your agent. You may, for example, prefer to have the whole thing handled relatively discreetly. Or, you might decide to go for broke, put an “Open House” sign in the window, and hang balloons and bunting all round your front garden, so that no-one is left in any doubt about what is going on! Either way, your agent will ensure that details of the event – which for obvious reasons will normally be scheduled for a weekend - are widely advertised in advance.
Meanwhile, all you need to do is make sure your home is looking its best, and that any items of value are safely locked away. Then, it’s just a mater of waiting to see who turns up on the day, making a note of their names and contact details, and leaving them to look round at their leisure.
Of course, as with anything else, there are no cast-iron guarantees that an Open House will deliver the goods. But particularly in the current market, that extra string to your bow could just make all the difference!
Tuesday, 21 June 2011
My buyer has been let down by the person who was going to buy his house. Should I stick with him, or should I remarket. Plus what extra will it cost ?
You won’t be surprised to learn that this is quite a common dilemma, particularly in the current market. With buyers relatively few and far between, do you hang on to the one you’ve already got, who sounds pretty committed, in the hope that he finds another purchaser for his own place quickly, or do you take a chance on finding another one and starting from scratch again?
On the surface, it looks like a tough call. Either way, of course, you could theoretically miss out. You might lose your existing buyer, and get no more takers. After all, you know what they say about a bird in the hand. But then again, there could be a whole flock of other equally suitable birds out there in the bushes, just waiting for the chance to swoop!
In reality, however, this isn’t that much of a problem. Basically, you need to look after number one, so I would advise you to put your property back on the market. You are of course perfectly entitled to do so, since under the English system nothing is legally binding on either party until exchange of contracts. Don’t forget, your buyer would probably have no hesitation in pulling out if he saw something else he preferred.
That said, of course, he certainly needs to be informed of your decision - for three very good reasons (which you can put in your own order of importance). First, your agent is actually legally obliged to do so, in writing. Second, it’s the only decent way to behave. And third, in all probability he will still want to buy your house, so it makes sense to keep him onside, because he might still come up trumps before anyone else.
As for whether remarketing will involve any extra fees, the answer should be a resounding “No.” After all, your agent is probably working on the usual no sale, no fee basis – and hopefully you will have chosen a solicitor who does the same. The only other cost to you so far on the sale of your property is presumably the EPC - and that is valid for 10 years anyway.
On the surface, it looks like a tough call. Either way, of course, you could theoretically miss out. You might lose your existing buyer, and get no more takers. After all, you know what they say about a bird in the hand. But then again, there could be a whole flock of other equally suitable birds out there in the bushes, just waiting for the chance to swoop!
In reality, however, this isn’t that much of a problem. Basically, you need to look after number one, so I would advise you to put your property back on the market. You are of course perfectly entitled to do so, since under the English system nothing is legally binding on either party until exchange of contracts. Don’t forget, your buyer would probably have no hesitation in pulling out if he saw something else he preferred.
That said, of course, he certainly needs to be informed of your decision - for three very good reasons (which you can put in your own order of importance). First, your agent is actually legally obliged to do so, in writing. Second, it’s the only decent way to behave. And third, in all probability he will still want to buy your house, so it makes sense to keep him onside, because he might still come up trumps before anyone else.
As for whether remarketing will involve any extra fees, the answer should be a resounding “No.” After all, your agent is probably working on the usual no sale, no fee basis – and hopefully you will have chosen a solicitor who does the same. The only other cost to you so far on the sale of your property is presumably the EPC - and that is valid for 10 years anyway.
Friday, 18 February 2011
We are currently looking to buy our first new home in 15 years or so, and would appreciate some general advice.
If you have another property to sell, then the first thing you need to do is put it on the market. As a buyer, whatever the state of the market, it is always better to be either completely unencumbered or at least well on the way to selling. Besides, it will also make it easier to work out your budget.
Next, house-hunting. These days, most people conduct their initial searches via the internet, and registering with agents online is pretty straightforward. But remember, they’re not all the same. Even though you’re a buyer rather than a seller, you still want personal service and a good working relationship. So – everything else being equal – the best agents to register with are likely to be the ones who take the trouble to reply with a phone call, rather than just an email.
Before registering, however, take the time to establish clearly in your own mind exactly what you’re looking for – and make sure you explain those requirements fully. Also, make sure to give the agent all the information you can regarding your own situation, financial and otherwise.
When it comes to checking out individual properties, be selective – otherwise you risk wasting a lot of time and effort, most of it your own. Go and inspect your chosen properties - preferably in the company of the agent, and always in daylight. Write a list of all the questions you want to ask the seller, and make your own notes afterwards, so you can review them at your leisure. Lastly, be patient. This is the biggest investment you will probably ever make – at least, until your next move! – so don’t rush.
When you eventually find the property you want (a second viewing is always a good idea, to confirm whether your initial impressions still hold good), then make a formal offer through the agent.
For further information on selling or letting property log on to wwww.tudorestates.co.uk
Next, house-hunting. These days, most people conduct their initial searches via the internet, and registering with agents online is pretty straightforward. But remember, they’re not all the same. Even though you’re a buyer rather than a seller, you still want personal service and a good working relationship. So – everything else being equal – the best agents to register with are likely to be the ones who take the trouble to reply with a phone call, rather than just an email.
Before registering, however, take the time to establish clearly in your own mind exactly what you’re looking for – and make sure you explain those requirements fully. Also, make sure to give the agent all the information you can regarding your own situation, financial and otherwise.
When it comes to checking out individual properties, be selective – otherwise you risk wasting a lot of time and effort, most of it your own. Go and inspect your chosen properties - preferably in the company of the agent, and always in daylight. Write a list of all the questions you want to ask the seller, and make your own notes afterwards, so you can review them at your leisure. Lastly, be patient. This is the biggest investment you will probably ever make – at least, until your next move! – so don’t rush.
When you eventually find the property you want (a second viewing is always a good idea, to confirm whether your initial impressions still hold good), then make a formal offer through the agent.
For further information on selling or letting property log on to wwww.tudorestates.co.uk
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