Stamp duty threshold raised to £175,000 to help first-time UK home buyers

Buyers of homes worth up to £175,000 are exempt from stamp duty for 12 months.

Announced yesterday by the Chancellor Alistair Darling, this is part of a package of measures designed to revive the UK housing market.

The change, which comes into effect from today, raises the threshold on which 1% stamp duty is paid from its current level of £125,000.

The move will save eligible home-buyers up to £1,750 when they purchase a property, and relates only to buildings entirely for residential use.

Read more on the BBC News website.

Laurent Stadelmann
The Property Finder & Relocation Professional

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Landlords, remember your Energy Performance Certificate!

In December 2007 I wrote about the requirement to provide a HIP (Home Information Pack), which must contain an Energy Performance Certificate (EPC), when selling a property.

From 1 October 2008, all buildings, whenever they are built, sold or rented out, will require an Energy Performance Certificate (EPC).

This new piece of legislation will affect landlords starting new tenancies (many landlords are still unaware of this – please do not Landlords, remember your Energy Performance Certificate!
hesitate to forward this information).

If you are a landlord and you:

• already have a tenancy agreement on 1 October 2008; you will NOT require an EPC.
  
• plan to let for the first time or re-let your property(ies) after 30 September 2008; you will have to provide a copy of the EPC (a photocopy of the original is acceptable) to serious prospective tenants, either prior to or at the viewing of property.
  
  - If you let a property to several individuals each of whom has free use of the whole property (from a contractual point of view), then only one EPC will be required
  - If you let a HMO (House in Multiple Occupation) – a property with shared living amenities plus individual contained bedrooms (with locks) – to 5 people, for example, then six EPCs will be required: one for the property, and one for each self-contained room
  - I advise you to commission an EPC for each property you plan to let as soon as possible, as it is very likely that there will be huge demands for new EPCs in August and September.

An EPC is produced after an inspection of a property is carried out by an accredited Domestic Energy Assessor. The landlord is responsible for ensuring this is done. An EPC is likely to cost between £50 and £100, and will be valid for 10 years.

However, if modernisations are carried out, it may be advantageous to have the property re-assessed to reflect the improvements.

EPCs only apply to England and Wales. Northern Ireland and Scotland are producing their own regulations.

The rationale behind EPC and its characteristics
EPCs are part of measures being applied across Europe and are in line with the European Directive for the Energy Performance of Buildings to help cut buildings’ carbon emissions and tackle climate change.

EPCs are measured using the same calculations for all properties, enabling comparison of the energy efficiency of different homes. Part of the EPC is a recommendation report which lists the potential rating that a property could achieve if changes are made. The report lists improvements that one could carry out and how this would change the energy and carbon emission rating of the property.

An EPC (see sample) provides ‘A’ to ‘G’ ratings for the building, with ‘A’ being the most energy efficient and ‘G’ being the least, with the average to date being ‘D’.

Measures you can take now to improve your property energy efficiency
If your rental property is already energy efficient, the EPC will help it stand out compared to those not so energy efficient: potential tenants will be re-assured of lower energy bills – very important in these days of rising energy and fuel prices.

There are some measures you can take now to improve your property energy efficiency, and improve your EPC rating:
1: Replace light-bulbs with low-energy versions
2: Ensure the hot water cylinder has a jacket
3: Insulate the loft
4: Insulate cavity walls
5: Replace an old boiler (15 years+) with a new high efficiency condensing unit, which could save around a third on heating bills straight away.

To find out more about EPCs, visit Directgov.

Laurent Stadelmann
The Property Finder & Relocation Professional

Too busy to hunt for your next home?
Let Chez-Vous HomeSearch remove stress from the property process!
Tel: +44 (0) 1189 770215

PROPERTY FINDING FOR BUYERS / HOME SEARCH FOR TENANTS / CORPORATE RELOCATION SERVICES / PURCHASE PRICE NEGOTIATION SERVICE / LOCATION REPORTS / FREE INFORMATION TO HELP YOU HOUSE HUNT

Don't forget to ask what the neighbours think

Friends of mine had found their perfect house. A renovated 3-bedroom Victorian property with original period features: slate roof tiles, Victorian fireplaces, large sash windows, etc.

Before making an offer the friends asked for my professional opinion. The property had been completely refurbished to an excellent standard and it looked sound. And on the face of it, at that moment in time, the neighbourhood looked good too.

When I search for property I always do a lot of research, including asking neighbours what they think of the area.

So after the viewing I suggested that this is exactly what we should do. Although the friends were not very comfortable with the idea, we nevertheless stopped to speak with a couple of locals and asked if they were happy living there. Well, we discovered more than we bargained for - cars regularly stolen (including theirs!), police chases, burglaries... These particular locals concluded that they wished they had never bought their houses and feared they would be difficult to sell.

My friends could not believe their ears. These little conversations probably saved them a lot of hassle - potential car theft and burglary, expensive insurance, not to mention stress and worry. Needless to say, they didn’t make an offer on that house, but they now realise that the neighbours can be a source of valuable information.

Laurent Stadelmann
The Property Finder & Adviser

Too busy to hunt for your next home?
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Tel: +44 (0) 1189 770215

PROPERTY FINDING FOR BUYERS / HOME SEARCH FOR TENANTS / CORPORATE RELOCATION SERVICES / PURCHASE PRICE NEGOTIATION SERVICE / LOCATION REPORTS / FREE INFORMATION TO HELP YOU HOUSE HUNT

Renovation advice to boost property profits

Last week I attended an excellent property seminar in which Dr. Dennis Coote talked about “Renovation Techniques to Boost your Property Profits”.

Dennis is passionate about property, having developed, renovated, bought and sold over 400 properties during his 40 year career. Dennis and his partner Hazel Reed are currently renovating a property in Reading.

Dennis reminded his audience of the first golden rule when investing in property: “To make a profit, you must buy at the right price. The profit you make is made when you buy, not when you sell.” This is even more appropriate in the current climate!

During the seminar he covered a wide range of subjects, aimed at helping investors looking to buy and renovate property: types of property to consider and to avoid; basic tool kit to take with you when viewing properties; location considerations; how to find, select and save money when dealing with tradesmen; sequence of work during the renovation process; etc.

Dennis also described some simple renovations and repairs which can be carried out by those skilled in DIY. Did you know that instead of paying a plumber to repair a toilet that is not flushing properly due to a damaged diaphragm, you can create a replacement plastic diaphragm yourself and save at least £50? Or that if you need to drain your central heating system but the draincock is blocked, you can buy a special clamp-on tap called a tee-valve (costs about £5), and fit it yourself on the pipe with a spanner. No leaks, no mess! And a lot of money saved! One very strong piece of advice: don’t play with gas!

Dennis recommends a visit to The National Self Build & Renovation Centre in Swindon (M4 Junction 16).

To find out more about Dennis Coote, visit: Property Development for Profit - Dr. Dennis Coote's ecourse on property

Laurent Stadelmann
The Property Finder & Adviser

Too busy to hunt for your next home?
Let Chez-Vous HomeSearch remove stress from the property process!
Tel: +44 (0) 1189 770215

PROPERTY FINDING FOR BUYERS / HOME SEARCH FOR TENANTS / CORPORATE RELOCATION SERVICES / PURCHASE PRICE NEGOTIATION SERVICE / LOCATION REPORTS / FREE INFORMATION TO HELP YOU HOUSE HUNT

Purchasing property in a buyer’s market

Since the UK credit crunch began in summer 2007, mortgages and property have rarely been out of the news. These two topics have become the constant topic of conversation all over the country.

A year ago we were in a seller's market. Now it is the opposite: a buyer's market. So what does this really mean for you if you are a residential property buyer?

In general terms the market has moved in your favour. The Halifax announced that house prices fell by 2.5% last month from February 2008. The other main housing index, Nationwide, indicated that prices fell by 0.6% in March. According to Peter Hogan of the Royal Institute of Chartered Surveyors, "Sellers are having to reduce by between 5% and 10% of the asking price. Many buyers are biding their time to see what will happen."

In reality it depends on which rung of the property ladder you are on and your current mortgage situation as to whether you can immediately benefit from this buyer’s market. If you are looking for a first-time mortgage or need to remortgage then it has become more complicated and expensive. Get plenty of advice from expert advisors. A good mortgage broker will seek to find you the best deal appropriate to your circumstances. Mortgage lenders are currently withdrawing many offers and putting up their rates and fees on new ones (even though the Bank of England decided this month (April 2008) to cut the base rate of interest by 0.25% - down from 5.25% to 5%). When you find a mortgage that is right for you, act quickly to secure it.

If you are ready to purchase now, I recommend that you do your homework and negotiate on price. Make a lower offer based on your research (market conditions, how long the property has been on the market, potential structural problems to fix, poor presentation, etc.), and that you feel comfortable with. If you believe that a property is over-priced then make an offer that you consider realistic. No one can predict the future but if you can’t purchase at a price that you are confident with, then walk-away from potential financial problems and negative equity. The last thing you want to be worrying about is a possible future house price slide and killer mortgage payments.

Remember, a property is only worth what somebody is willing to pay for it! If you are at all uncertain or uncomfortable about doing the negotiation yourself then get someone who is a confident negotiator to do it for you - a friend, a family member or an expert professional property finder and purchase price negotiator.

Next time I will be discussing vendors selling in a buyer’s market.

Make sure you sign-up now to receive our FREE quarterly Property Matters! newsletters containing market news, Chez-Vous news, stories, features, tips and property events.

Laurent Stadelmann - The Property Finder & Adviser
Managing Director - Chez-Vous HomeSearch

Ten tips when buying leasehold flats

After reading our last issue of “Property Matters!” Newsletter Andy Szebeni of A&P Sales Training and Telemarketing replied to our “Share your property stories” section. Andy suggested sharing amongst our readers ‘10 tips when buying leasehold flats’, collated by one of his clients, Leasehold Solutions Limited.

Would you be surprised to know that if you were to ask the average buyer what issues they are considering with regard to the leases on the flats they are viewing, you may be met with silence? Many buyers do not realise or consider the implications that purchasing a leasehold property may have. But they should! Issues relating to the leasehold of flats can have a significant impact on the value and future marketability of a flat. So if you are considering purchasing leasehold, I strongly suggest you read these “10 top tips about leases” first.

Read more about issues to consider when buying a leasehold flat.

Make sure you sign-up now to receive our FREE quarterly Property Matters! newsletters containing market news, Chez-Vous news, stories, features, tips and property events.

Laurent Stadelmann - The Property Finder & Adviser
Managing Director - Chez-Vous HomeSearch

Property investors, landlords - are you claiming all your expenses?

Here are some tips that I published in my last newsletter that I thought may be useful.

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Some investors or landlords may not be aware of some of the expenses and allowances they can deduct from the taxable rental income. Ensuring that you offset all your legitimate costs will help minimise your tax bill.

Some of the expenses that can be offset against rental income are:

• Finance charges: any interest paid on the loan/mortgage taken out to purchase a rental or buy-to-let property is tax deductible, as is interest on any secured or unsecured loans taken out to obtain the property or to finance repairs.
  
  
• Legal & professional fees: if you use the services of accountants and letting agents, their fees are tax deductible.Legal expenses associated with preparing tenancy contracts and dealing with tenant disputes are also tax deductible. However legal expenses associated with purchasing property cannot be offset against rental income (these expenses are offset against your capital gains tax liability when you sell the property).
  
  
• Council Tax, electricity, water & gas: if all rooms are rented out, all the usual running costs are fully tax deductible, assuming that none of the tenants makes a contribution to the bills. If you let your property exclusive of all the bills, then you cannot claim.Between tenancies the landlord is responsible for paying council tax and utility charges, which are tax deductible.
  
  
• Insurance: buildings insurance, contents insurance, rental guarantee, as well as maintenance insurance policies for gas boilers, plumbing cover and white goods are also tax deductible.
  
  
• Ground rent & service charges: on a leasehold property there is usually a ground rent and a service charge to pay to the freeholder; these are deductible.
  
  
• Marketing and advertising costs: any costs associated with finding tenants or selling your property are tax deductible. Other tax deductible costs include expenses such as setting up a website or having some “to let” boards made up.
  
  
• Managing / letting agent fees: if you use agents to let and/or manage your property, their fees are tax deductible.
  
  
• Cleaning between tenancies
  
  
• Garden maintenance
  
  
• Wear and tear: if you let furnished accommodation, you can claim 10% of the gross rental income (minus rents, rates, council tax, water rates).
  
  
• Administration expenses: any stationary, office and administration expenses such as telephone, all paper and envelopes, printing, postage, office consumable and any other costs incurred in connection with running your property business are fully tax deductible.
  
  

I would like to clarify that I am not a tax expert. Please check with an accountant or Tax Office if there are issues that are particular to your personal and property circumstances.

Laurent Stadelmann
Managing Director - Chez-Vous HomeSearch

Gazumping – You’d never want it to happen to you!

The problem in England and Wales is that until contracts have been exchanged the sale agreement is not legally binding. Until that point, the current system permits buyers and sellers to pull out of the agreement, and the practices of gazundering and gazumping!

Last week I described the awful practice of gazundering, sprung on sellers by their purchaser, and advised planning a strategy in advance just in case. And this week, I will look at the issue of gazumping where the roles are reversed.

Gazumping happens when a seller, who has already accepted a buyer’s offer, decides to accept a higher offer from someone else. The first buyer is left with two possible choices: they offer a higher price and get into a potential bidding war, or they decide to let the property go, lose out and look for an alternative.

From a buyer’s point of view, gazumping is not only a stressful experience but it also costs money when surveys, searches and other fees have already been incurred.

This practice is popular when property prices rise and when there are more buyers than sellers in the market.

As a buyer, how can you try avoiding being gazumped? Unfortunately, there isn’t much you can do about it, but there are some precautions you can take:

• Ensure that the buying process is as quick as possible; the quicker the better, as it will provide less opportunity for the seller to receive and consider offers, play games, or even pull out of the sale altogether.


• Before making an offer, find out if the estate agent has a policy on gazumping. Some agents request sellers to sign an agreement to turn down any further offers after one has been accepted.


• After your offer is accepted, ensure that you regularly communicate with the estate agent/vendor to let them know about your buying progress status: inform them when the survey will take place; let them know when the survey is completed; update them on the status of your mortgage offer, etc.


• Persuade the seller to sign a “lockout agreement” when your offer is accepted. The seller signs this agreement stating that they will not accept another offer from anyone else as long as the contracts are exchanged within a set time. You should use a solicitor to draw this up.


• Another possibility is a “pre-contract deposit agreement”. This means that each side pays a deposit (an agreed percentage of the purchase price) that will be lost if they pull out without a good reason. Obviously this agreement does not completely guarantee a smooth transaction as either party can pull out if they are willing to lose the deposit. But it will reduce the risk of being gazumped. And if you become a gazumped buyer, you will get some compensation. You should use a solicitor to draw up this agreement.


• Some insurance companies offer gazumping insurance policies to cover fees you might have incurred. Always weigh up the cost of insurance policies and read the small print!

As a buyer, always be prepared for the eventuality of being gazumped. Try to not set your heart on the property until it is signed and sealed. But if you really want it or have no other choice then ensure that you have a contingency plan allowing you to increase your initial offer.

And if you are gazumped but you don’t want to make a higher offer, let the estate agent and vendor know if you are still keen on the property. If the other buyer with the higher offer pulls out, you may still be in with a chance of securing the property if that’s what you want.

As I’ve said before, any negotiation should be based on trust and be fair to both parties. My advice is always to agree on a price at the beginning of the transaction and stick to it.

Laurent Stadelmann
Managing Director

Chez-Vous HomeSearch
Removing stress from the property process!

Property Finder / Relocation Services / Negotiation Service / Location Reports

laurent@chez-vous.biz
www.chez-vous.biz
Tel: +44 (0) 1189 770215

The path to successful property investment

Successful individuals and entrepreneurs have found different ways and methods of building their fortunes. One of the most accessible ways is investing in property. In fact, the annual Sunday Times Rich List, the definitive guide to wealth in Britain and Ireland, confirms that the richest people make millions in land and property.

Property is a great strategy for the investor who is willing to take the time to learn about the options, risks, and potential rewards for this type of investment process.

The UK property market has always been a subject of immense interest, especially as we have experienced an extraordinary rise in property values over the years. Furthermore, there have been so many different types of mortgages available on the market enabling people to get a foot on the investment property ladder easier.

It is impossible to predict if property values will increase forever. However, when you consider that historically, property in the UK has doubled in value every seven to nine years, then it is not difficult to understand that it is a fantastic investment platform if you are prepared to take a long term view.

A successful property investor makes money both in a rising and in a declining market. For example, during a rising market, property investors can release some of the equity built up over time to either purchase additional properties or to keep some money aside to be used at a later date. During a declining market, they buy lower-priced bargain properties. This is why market value trends do not affect property investors who are in it for the long term.

You have probably heard that location, location, location is the most important factor to consider when buying property. This is absolutely true as getting the right location can make the difference between success and failure.

I also believe that research, research, research is an equally important element of the property investment process. It is critical to ensure that you learn as much as possible. For example, talk to property experts and estate agents, go to property networking events and exhibitions, learn how to buy the right property at the right price in the right area, find out how to make the right alterations to the property within the appropriate budget, etc. You need to have a thorough understanding and all the relevant facts to hand before committing to a purchase.

And if you don’t have the time or the confidence to take the plunge into property investment then don’t despair. There is a wealth of professional expertise and support out there for every step of the process.

By committing to the long term strategy and by combining research and location, you have a recipe for success.

For further information on how Chez-Vous HomeSearch can assist with your property investment plans, please contact Laurent Stadelmann on +44 (0) 1189 770215 or at laurent@chez-vous.biz.

Laurent Stadelmann
Managing Director

Chez-Vous HomeSearch
Removing stress from the property process!

Property Finder / Relocation Services / Negotiation Service / Location Reports

laurent@chez-vous.biz
http://www.chez-vous.biz/
Tel: +44 (0) 1189 770215

Starting to invest in property in need of renovation

When starting to invest in property in need of renovation you could look for badly maintained or run down properties that need a lot improvement. These homes are much cheaper to purchase but they will take some time and experience to improve. You can also focus on homes that need less work, such as cleaning up, painting, and in some cases new flooring. You do not want to buy something too run down, as it could cost a lot of money to renovate.

If you are a DIY expert and are experienced enough to fix most of the repairs yourself, you can save a lot of money. On the other hand, if you need to hire someone, you should always ensure that the individual or company is qualified accordingly and has a good reputation. People or companies recommended by friends, family or acquaintances are the ones to seriously consider. Ask them for 2 or 3 further references and check out the work they have done.

You should always arrange for a survey to be carried out by a Chartered Building Surveyor prior to the purchase of any property. This will enable you to assess the nature of any defects and if the property is worth investing in. The result of the survey could even help you to re-negotiate the purchase price in your favour.

If you decide to stay in the property renovation business, you will learn a lot over the years. You will work with a team of professionals you can trust. After you have successfully renovated and resold several properties, you will begin to feel more confident with buying homes that need repair. All it takes is time and practice - and you will be buying homes that the average investor would not think twice about. This can be a huge advantage when you are looking for homes to buy and resell, as there will be less competition to worry about. You will also be able to negotiate lower purchase prices, simply because you will be able to use the cost of the repairs to your advantage.

Once you are experienced in renovating properties, even those with structural problems, you will have a huge advantage in the market. You will be able to buy virtually any home, including those that other investors choose to ignore. Doing so can be very profitable, especially when properties are in sought-after areas. After you have done the repairs, you will be able to resell the home for a much higher price than what you paid for.

When you start looking for properties in need of renovation, you should always take your time and buy the right homes. You may not have the money, time, experience, or support to buy the bigger houses at first, which means that there will not be much room for mistakes. Once you have purchased and resold a few smaller homes, you will eventually be able to work your way up to the bigger properties which is where the big profits will come into play.

Always keep in mind that when you first start out, you will need to patient. You cannot expect profits to come overnight, especially if you make a few costly mistakes. Once you have been experienced for a few years and have several properties to your credit, you will be ready to tackle anything. At that point you will make a lot of money in a career that is truly exciting!

Laurent Stadelmann
Managing Director

Chez-Vous HomeSearch
Removing stress from the property process!

Property Finder / Relocation Services / Negotiation Service / Location Reports

laurent@chez-vous.biz
http://www.chez-vous.biz/
Tel: +44 (0) 1189 770215