Latest House Prices

 

According to the Halifax House Price Index house prices have jumped to the highest level since March, as a lack of supply has supported the housing market since last summer’s EU referendum.

House prices in the three months to December 2016 were 2.5% higher than in the three months to September 2016.

House prices in the three months to December were 6.5% higher than in the same three months of 2015.

Martin Ellis, Halifax housing economist, commented:

“House prices finished 2016 strongly. Prices in the final quarter of the year were 2.5% higher than in the previous quarter. The annual rate of growth increased, rising for the second consecutive month, from 6.0% in November to 6.5%.

“Slower economic growth, pressure on employment and a squeeze on spending power, together with affordability constraints, are expected to reduce housing demand during 2017. UK house prices should, however, continue to be supported by an ongoing shortage of property for sale, low levels of housebuilding, and exceptionally low interest rates. Overall, annual house price growth nationally is most likely expected to slow to 1-4% by the end of 2017. The relatively wide range for the forecast reflects the higher than normal degree of uncertainty regarding the prospects for the UK economy this year.”

Some other key facts from the Halifax index were:

1. House prices increased by 1.7% between November and December
2. Luton recorded the biggest percentage rise in house prices among major UK towns and cities over the past year;
3. Total UK home sales in 2016 set to be broadly unchanged from 2015 and 2014 at 1.2 million;
4. Mortgage approvals were 6% higher in the three months to November compared with the preceding three months
5. Supply remains very low.

You can read the full Halifax report here

BHW Residential for Leicester Conveyancing

 

Positive Plans to Reduce Construction Waste

The annual NextGeneration report, released last week benchmarks the sustainability of 25 UK firms across a range of factors including reporting, environmental site management, water, carbon and transport.

NextGeneration members include BHW Residential client Barratt Homes.

With half of the UK’s waste generated by the construction industry, this presents an “enormous opportunity for improve resource efficiency and reducing costs with an increasing number of companies realising the potential for profitability and resilience.”the paper states.

NextGeneration states its intentions to address the issue, through workshops and events, on how to integrate the circular economy into homebuilding in 2017.

This was reflected by three members making Net Positive commitments to deliver greater biodiversity and negative carbon emissions.

The 2016 NextGeneration results placed Lendlease at the top of the pile, with Crest Nicholson and Barratt Homes close behind in 2nd and 3rd place respectively.

The UK Green Building Council (UK-GBC) has stated that the companies featured in the leading rankings demonstrate that building high quality developments are “core to what they do”.

You can read the full EDIE article here

 

Clear Advice Needed On Leaseholds

The press has been full of stories in the last month about the resale of Leasehold properties on relatively new estates.

This reports have also covered the value of the freehold if the leasehold owner wishes to buy the freehold.

The reports featured in the Guardian newspaper highlighted the plight of a couple who bought a flat in Dudley from Taylor Wimpey in 2010, with clauses relating to the annual ground rent that are now causing resales to fall through six years after they properties were first occupied.

In the 125-year lease the £250 ground rent on the two-bed Dudley flat doubles every 10 years.

The potential buyers have withdrawn due to what they feel is an excessive ground rent obligation.  Also this clause has a effected the mortgage valuation, increasing that difficulty of finding a mortgage.

To complicate the matter further Taylor Wimpey sold the freehold interest to a 3rd party company in 2012.

You can read the full story from the Guardian Here

Our advice is to get the best residential conveyancing advice relating to any leasehold property purchase.

Tesco Looking at Local Housing

Tesco have devised a new business plan to help with the current urban and inner city housing problems and improve the companies finances.

This radical strategy devised by chief executive Dave Lewis, to overhaul its vast store estate, which analysts say could raise £1.5bn.

The scheme involves Tesco’s teaming up with property developers to build flats over their existing out of town superstores and large carparks.

The timing of this plan coencides with the announcement of the government to build a million new homes by 2020.

Tesco are considering various options including seeing airspace about their land on long leaseholds, selling land and excess space around the stores.

Developments in London could deliver 180,000 new homes worth £54bn, according to consultants at HTA Design. Compared with other cities worldwide, London is relatively low-rise. But that could change as land is scarce.

According to an article in the Telegraph this week Tesco has already identified 15 sites, most of which are in London, with another in Oxford.

You can read the full Telegraph article here…….

It will be interesting to see if Tesco or other major supermarket operators look at similar residential property schemes in Leicester or the cities of the East Midlands.

Leicester Property Solicitor Bev Merrell writes for BHW Residential.

 

Landlord Tax Changes

From April 2017 the government’s new tax regime will start to affect Buy-to-let landlords.  These changes will be phased in over four years.

Many expert commentators think that Landlords may be forced to raise rents or sell their properties as the phased tax changes begin to bite.

Currently the landlord’s interest payments made on mortgages as with other types of business, is a valid deductible expense, so the landlord only pays tax on their actual profits.

Starting in the 2017-18 tax year this will be changed over 4 years, which is likely to increase the amount of Income Tax due.

Research from the National Association of Landlords shows that the new rules could affect over 400,000 of UK landlords (25%) with them facing a tax increase from the 20% basic rate, to the 40% higher rate once the new rules start to come into force.

The new rules will affect all landlords who whose total rent and other income (before mortgage or other interest is deducted) exceeds the 40% Income Tax threshold.

In the 2017-18 tax year, 25% of finance costs will be subject to the new rules, rising to 50% in the 2018-19 tax year, 75% in 2019-20 and 100% from the 2020 tax year onwards.

For many landlords who have high levels of borrowing these phased changes, coupled with any mortgage interest rate increases, could make their business unprofitable.

In the market buy to let landlords are buying new homes and renting. This has affected demand and in some cases is seen as at odds with the Governments Help to Buy scheme.

These tax changes may see some of this housing stock being sold by the Landlords or the cost being passed on to their tenants in the form of rent increases.

There are landlords with 1 -5 properties who invested their money into property because they were getting no interest on their savings in the bank, or following the financial crisis, no longer trust the pension model, who are now reliant on rental income.

As you would expect there are strong arguments and opinions from both sides.

“Landlords will face an impossible decision of whether to increase rents and cause misery for their tenants, or to sell-up, and force their tenants to find a new home”.

Economists at the Institute for Fiscal Studies said: “There is a big problem in the property market making it difficult for young people to buy, and pushing up rents. The problem is a lack of supply. This change will not solve that problem.”

But the Bank of England’s policy to reduce high loan to value buy-to-let mortgages continues to take effect. Here is the latest PRA press release in September 2016.

Roy Horton writes for Leicester Conveyancing Solicitors BHW Residential

 

How Conveyancing Solicitors Have Changed

The forward thinking conveyancing solicitors have embraced the emergence of the Internet to market their legal services online.

Specialist conveyancing solicitor firms have successfully weakening the status quo of using a regional solicitor who traded on the “local knowledge” card.

The reality is, all conveyancing solicitors need to carry out precisely the very same regional enquires and searches.   Many new home developers use solicitors that are based many miles from the developments they’re selling.

So “regional expertise” doesn’t actually now play a significant part in your house conveyancing.

Now with the current conveyancing process, Land Registry and detailed online searches there is no need to meet your solicitor face to face. Everything that needs doing is accomplished by; phone, post and email. It a system that’s been working well for years.

What Will You Find Online

By looking carefully online you’ll discover that prices for conveyancing have fallen but the consumer needs look at the fine detail of various offers they see. Here are the sites which should be view with caution:

Conveyancing Comparison Websites

These sites produce a list of solicitors or licensed conveyancers based on price and location. You choose a company and they pay the comparison site an introduction commission based on the lead or the instruction.

Panel Websites

These sites will offer you a limited choice of solicitors or licensed conveyancers who are on their panel. They will say they have checked the competence and vetted all of firms on their panel. They take a commission of around £150-200 when you instruct a member of their panel.

Estate Agent Websites

Remember the Estate Agent does not get paid until the after the property completion, so it is in their interest to have a good relationship with the conveyancing firm. In some cases the Estate Agency owns the conveyancing firms. They get a substantial referral fee for sending you to the conveyancing firm so it is unlikely you will get the best market price for this service.

Warehouse Conveyancing Sites

Their business model is mainly internet based and they can be backed or owned by very large companies. They operate using call centres (often overseas) and therefore it is unlikely you will speak to the same person twice.

They have a process driven workflow with different staff doing individual parts of the conveyancing proceedure. Some staff will be data processors and trainees. These junior staff are overseen by a team manager who will be qualified as a solicitor or licensed conveyance. In the last two years, with the need to cut costs the team managers are under more pressure as their team numbers have grown.

This type of approach to conveyancing is inflexible and cause major delays especially if the home move is not straightforward.

What Causes the Delays in Completion

The main question and flustration for all people moving home is “how quickly can we move”.

For a typical property the average house conveyancing timescale is in England and Wales is 8-12 weeks,

The timescale should not be this long, most searches are now done online and the local council searches are not taking as long as they did in 2014-15.

So what really can cause the delays:

• The mortgage application and approval process
• Your local authority search
• Dealing with more complex Leasehold transactions
• Dealing with an unpredictable chain
• Slow responses from other parties

When you are buying or selling your home the simple facts are:

• if you are represented by a specialist conveyancing solicitor and so are the other parties then your home move should be smooth and less stressful.
• If you are represented by a sub standard firm then you will not be moving quickly and you move could become a stressful aggravating ordeal.

Are you buying or selling your home in Leicester

If you are considering selling you home in the Leicester area, then first check out how much your property might be worth in the present market.

There are many online tools that show this information one of the easiest to use is Rightmove.co.uk. If you type your postcode in the “House Prices” tab on the Rightmove website. See below we have put in LG19 2DG into the Rightmove search.

 

The Rightmove Price Comparison Report shows you the property currently “On the market” and the property “No longer on the market”. In the section below it shows you if the property has been sold or removed and the date.

However the next section Market Trends is the most interesting because it shows you the marketed and sold properties.

The sold house prices are accurate because they come from Land Registry data but you really want to check about a particular sale you can find all the details at the Land Registry “find a property” page on their website. Here you can get a copy of the title register for £3 and a copy of the title plan for £3

When you have an built up a picture of what house have sold in the last two years you can compare you property to them as start to get a feel for the realistic price you might achieve.

Next look at a possible asking price and then the lowest offer you would accept based on your personal circumstances.

When you have these three prices written down it is time to talk to local estate agents who are active in your area and house price range.

When selecting an estate agent there are tried and tested methods you can use. First draw up a list of 5-6 estate agents and visit them as a potential purchaser.

Make a note of your first impressions, the type of properties they have for sale, how you were treated, how friendly the staff were, the type of questions they asked you and if they were professional in their approach.

When driving home take a detour within a two-four mile radius of your home down roads you don’t normally travel and look at any “For Sale” boards or take you dog for a walk around the area.

Then draw up a short list of three agents, ring them and arrange for them to visit your home to discuss agreeing a value and putting it on the market.

It is a good idea to see the agents all in one day and allow at least and 90 minutes between appointments. This way you will not feel rushed and if they are only with you 30 minutes you have time to do other things. Have your list of questions ready, but let them do most of the talking.

If they ask which other agents you are talking to tell them they are on a short list of three and you will be making a decision in the next few days.  This should ensure that you get the best fee proposal from them now.

Remember the estate agent wants your business, so you can negotiate, here are some items that can be included in their sale fee – newspaper advertising, a shorter contract period, glossy sales particulars, extra internal photos and the fee inclusive of vat.

Talk to them about recent sales in the area and let them propose a guide or asking price.  Be realistic, some agents may recommend a higher asking price than you assumed from your research, to try to get you to instruct them.  However it is unlikely that all three estate agents will recommend the same asking price.

Ask yourself which scenario do you want to see after 4-8 weeks

• Strong interest with a steady flow of viewing, with two or three people making an offer.
• little interest, hardly any viewing, no offers

If your initial asking price is too high it can drive away interest and viewing.  When people search online via websites like rightmove, zoopla and primelocation they do use filters.  For Example if their budget is £320,000 they are likely to look at property with a maximum price of £350-360,000.  This 10% is the hope – negotiation factor.

If you feel a realistic price for your home is £340,000 with an asking price of £355,000 based on your research and an estate agent recommended price.

Finally when you have sold, contact BHW Residential for your conveyancing quote.  Your estate agent may recommend a conveyancer, but remember some of the large estate agents own their own conveyancing firms, so you may not get the best deal.