Written By Em

Em Morley

What Will Apple’s Relocation Mean for the Wandsworth Property Market?

Published On: October 19, 2016 at 9:33 am

Tags: Business,London,London property market,property market,Wandsworth

As Apple commits to relocating to the regenerated Battersea Power Station site by 2021, leading online estate agent eMoov.co.uk has examined what impact this could have on the local Wandsworth property market.

The agent has analysed price change in the London Borough of Wandsworth and four other locations where big name brands have moved into an area, bringing with them a large number of job opportunities. eMoov then compared house price growth since the arrival of each company with the country as a whole, as well as the period prior to the firm’s arrival.

Wandsworth Property Market

Since its final closure in 1983, the fate of Battersea Power Station has remained largely undecided. The first glimmer of hope for the area came in November 2006, when Real Estate Opportunities bought the site. In the six years prior to this deal, the average house price in Wandsworth had risen by a notable 77%, but 2% less than London as a whole.

Over the five years following the deal with Real Estate Opportunities, the intended regeneration scheme helped to breathe new life into the Wandsworth property market, with house prices accelerating in growth by 16% – 5% higher than the capital as a whole.

However, in November 2011, the Real Estate Opportunities scheme collapsed and the site went into administration. Despite this, house prices continued to climb across Wandsworth, rising by 18% between the collapse of the scheme and the start of construction on the latest project – 4% higher than the London average.

Despite this, it appears that those living and looking to buy in the area prefer the idea of regeneration than the actual implementation of it. Since work has begun on the site, the average house price across London has soared by 46%, while in Wandsworth, it has only managed a rise of 36%.

That said, with Apple committing to the site as the location of its UK headquarters, this slower rate of growth could soon be reversed, if other examples are anything to go by…

Mercedes-Benz & McLaren

What Will Apple’s Relocation Mean for the Wandsworth Property Market?

In the ten years prior to the opening of Mercedes-Benz World in Weybridge, the average house price in Elmbridge rose by a whopping 198%. Although this is a huge rate of growth, it doesn’t touch the increase seen across England as a whole over the same period, of 226%.

Between opening in 2006 and today, prices in the Elmbridge area have risen by 76% – 46% higher than the rate seen across England (30%).

McLaren’s relocation to nearby Woking has also had a positive impact on the local market. Since the McLaren Technology Centre opened in 2003, house price growth has exceeded the average across England (82%) by 10%.

EA Games

Similarly, the opening of EA Games’ Criterion headquarters in Guildford has brought a change of fortune to the area’s property market.

Although the presence of the company precedes the recent and ongoing regeneration of Guildford town centre, house prices in the area have increased by 44% since the firm moved to the town in 2007 – 17% higher than the rise recorded across England (27%) over the same period.

However, looking back over the eight years previous to the company’s relocation, the local market in Guildford only saw an increase of 158% – lower than the 195% growth experienced in England as a whole.

BBC

The BBC’s decision to head to Salford in 2011, bringing with it a host of job opportunities and existing employees looking for homes, seems to have elevated the local property market.

Since it started the move in May 2011, the average house price in Salford has risen by 30% – 3% slower than the country as a whole.

However, when compared with the state of the market previously, the data highlights the monumental turnaround that the regeneration of the dockland area and companies such as the BBC have had on the property market.

In the four years previous to the BBC moving its headquarters to Manchester, the average house price in England rose by 1%. Unfortunately for homeowners in Salford, the local market suffered a decline of 9% during the same period. Although house prices in Salford are still marginally trailing behind the rest of the country now, they have come out of the depths of the property market to almost on par with the rest of the country in just five years.

The Founder and CEO of eMoov, Russell Quirk, comments on the findings: “The regeneration of such an iconic landmark and the surrounding area is always going to impact the local market positively and, despite price growth slowing since work has started at Battersea, the area should soon overtake growth rates across London once it nears completion.

“The commitment by Apple to move to the site will bring a huge boost. Not only will the job opportunities on offer help the local economy, but when big brands relocate to an area, it creates a ripple effect of desirability across the whole market, whether you work for them or not.”

He explains: “We believe that prices in Wandsworth will continue to increase until 2021, but once Apple arrives, the market should see a notable jump in values. Wandsworth could see property increase by as much as 40% between 2021 and 2025, so it’s worth getting on the ladder now, as the rate of growth should once again surpass that of the capital as a whole.”

Landlords, if you’re looking for significant capital gains, the Wandsworth property market could be your best bet!

Buy-to-let mortgage sales up by 19% in September

Published On: October 19, 2016 at 8:54 am

Author: Em Morley

Categories: Finance News

Tags: buy to let mortgages,Buy-to-Let,landlords,mortgages

The mortgage market experienced significant growth during September, with total sales rising by 8.4% to £1.2bn.

In addition, buy-to-let mortgage figures also rose by 19% to reach £2.9bn. Residential sales also increased by 6.2% to £12.2bn.

Regional mix

By region, performance was varied over the course of the last month. The North West and London came top of the table for buy-to-let mortgage growth, with rises in sales of 12.7% and 11.7% respectively.

On the other end of the scale, Scotland and Northern Ireland saw the worst monthly growth, of just 1.9% and 0.7% respectively.

Buy-to-let mortgage sales up by 19% in September

Mr Iain Hill, Relationship Manager, at Equifax Touchstone, noted: ‘With unseasonal gains in August and encouraging figures for September, the market is showing positive signs for a strong end to the year. These healthy figures are very welcome, particularly in buy-to-let, where we have seen a number of new market entrants in the last year or so.’[1]

‘Although we still have a way to go to get back to the levels of business seen in 2015, the signs are promising. We are watching with great anticipation to see what this year’s unpredictable market will reveal next month,’ he added.[1]

[1] http://www.propertyreporter.co.uk/finance/buy-to-let-sales-surge-19-in-september.html

Welsh Government Decides to Continue 3% Stamp Duty Surcharge for Landlords

Published On: October 19, 2016 at 8:31 am

Author: Em Morley

Categories: Landlord News,Property News

Tags: buy-to-let landlords,landlord taxes,Stamp Duty,Wales

The Welsh government has decided to continue the 3% Stamp Duty surcharge for landlords.

The Land Transaction Tax and Anti-Avoidance of Devolved Taxes (Wales) Bill, which was introduced to the National Assembly on 12^th September 2016, details proposals for a new land transaction tax to replace Stamp Duty Land Tax (SDLT) in Wales from April 2018.

At present, the bill does not include provision for a higher rate of tax on purchases of additional properties, which currently exists under SDLT in England and Wales and Land and Buildings Transaction Tax in Scotland.

Welsh Government Decides to Continue 3% Stamp Duty Surcharge for Landlords

The 3% Stamp Duty surcharge for landlords was introduced on 1^st April this year. This guide explains how the additional tax will affect you: /landlords-guide-3-stamp-duty-surcharge/

To better understand whether the higher rate of tax should be introduced under the new bill, the Welsh government published a Treasury Paper and conducted a technical survey on the operation and application of the surcharge.

A total of 100 responses were received, with varied views. The government reports that some respondents believed it is important to remain consistent across the UK, so that distortions aren’t created, particularly across the England-Wales border.

Mark Drakeford, the Cabinet Secretary for Finance and Local Government, also believes: “As the Treasury Paper highlighted, there will be a significant reduction in the resources available for public services if we do not include a higher rate for additional properties in land transaction tax. Therefore, to protect the delivery of public services, I intend to make provision for a higher rate surcharge on purchases of additional residential properties in the Land Transaction Tax and Anti-Avoidance of Devolved Taxes (Wales) Bill during stage 2.”

However, he adds that the government will “continue to explore the suggestions put forward by stakeholders about how the higher rate can be adapted to meet Wales’ circumstances.”

A summary of the responses can be found here: http://gov.wales/docs/caecd/publications/161014-ltt-responses-en.pdf

The Managing Directors of both the Association of Residential Letting Agents (ARLA) and the National Association of Estate Agents (NAEA), David Cox and Mark Hayward, respond to the Welsh government’s decision to continue the 3% Stamp Duty surcharge for landlords:

“We are disappointed that the Welsh government has decided to take this decision and followed the rest of the UK in implementing this punitive regime for buy-to-let landlords.

“We have been highly supportive of the new devolved tax regime in Wales, precisely because it was a way that it could set its own tax agenda that works best for the housing sector in the region. In continuing with the surcharge, the Welsh government is not making the most of its new powers in order to increase the supply of homes that Wales so desperately needs.”

They also warn of further damage to the property market: “The measures will lead to increased rent prices through a fall in supply and increasing demand. Tenants will also see additional costs passed onto them, as landlords look for ways to increase the profitability of their properties in the face of spiralling expenses. Ultimately, this will lead to sub-standard accommodation, as money, previously used for the upkeep of homes, will be swallowed up in tax payments.”

Landlords facing minimum room size licensing scheme

Published On: October 18, 2016 at 2:27 pm

Author: Em Morley

Categories: Landlord News

Tags: buy-to-let landlords,landlords,licensing scheme,tenants

The British Government has today announced it is to introduce minimum room sizes for shared tenant homes. This is part of a wider national clamp down on rogue landlords forcing tenants into unsafe and overcrowded properties.

Housing Minister Gavin Barwell said that the measures will affect England only and will heighten councils’ ability to solve the issue. This in turn will bring an end to rogue landlords ‘ability to exploit tenants and charge them high rents for poor conditions.

Minimum sizes

Plans outlined today will see landlords letting properties to five or more people from two or more households would have to be licenced. In addition, they would have to provide a room of a minimum size of 6.52 square metres, thus closing a loophole allowing some rogues to rent rooms much too small for an adult.

Mr Barwell said: ‘These measures will give councils the powers they need to tackle poor quality rental homes in their area. By driving out rogue landlords that flout the rules out of business, we are raising standards and giving tenants the protection they need.’[1]

Other measures to help councils raise standards in multiple occupancy lets include ensuring mandatory rules apply to all shared properties with five or more people from two or more households. Additionally, this would apply to flats above and below shops and other business premises.

At present, licensing only comes into force for homes with three or more floors and does not apply to homes attached to businesses unless they are in a three-story property.

Landlords facing minimum room size licensing scheme

Storage

Under these proposals, landlords of shared properties will be permitted to provide sufficient storage and disposal of rubbish and pass a fit a proper person test. Criminal record checks will be carried out.

If a landlord fails to obtain a licence they will be liable to pay an unlimited fine. Mr Barwell believes these measures will complement other Government efforts to seek out unscrupulous landlords.

Already, £5m of Government funding to 48 councils has brought about a big increase in the number of homes checked in the last quarter. In early 2016, in excess of 33,000 homes were inspected. Around 2,800 rogues are facing prosecuting as a result of these checks.

[1] http://www.propertywire.com/news/europe/landlords-multiple-occupancy-lets-england-face-mandatory-licencing/

70% of eviction notices could be illegal

Published On: October 18, 2016 at 10:48 am

Author: Em Morley

Categories: Landlord News

Tags: buy-to-let landlords,eviction process,Housing Act 1998,investors

A law firm has claimed that a large number of buy-to-let landlords who are attempting to evict their tenants are being held up by defective Section 21 and Section 8 notices.

North West solicitors Kirwans said it has seen a significant rise in the number of private landlords seeing delays in evictions. In some cases, these can take more than two months, leading to rental losses. The problem surrounds invalid notices, which are part of the Housing Act 1998. These notices are being identified, with hold ups coming as new ones are subsequently issued.

Stress

Danielle Hughes of Kirwans observed that over the last three month, 70% of landlords seeking to evict have been held up by problematic notices. This is turn has caused much stress amongst buy-to-let investors.

Hughes noted: ‘The legal changes that have taken place in this area over the past 12 months have been fast-paced complicated and many landlords are finding that the notices they have prepared themselves using online forms, or even those that have been prepared for them by well-meaning letting agents are out-of-date as a result.’[1]

‘When trying to evict someone, landlords have to follow a strict process which sees them serve notice on the tenant, then issue a claim for possession in the county court, then request a warrant for possession and make an eviction appointment. Many landlords don’t seek legal advice until they try and move on to stage two of the eviction process, when the claim for possession is issued.’[1]

70% of eviction notices could be illegal?

Increases

The eviction process can be lengthy, with courts fees for all stages recently rising from £390 to £476. Hughes believes that most errors and risks occur during the first stage, when some landlords opt to go ahead without the advice of a solicitor.

Concluding, Hughes said: ‘Time and time again we are seeing defective notices. The impact of this on the landlord can be devastating, both in terms of emotions, costs and delays, particularly in situations where the tenant is no longer paying rent.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/10/up-to-70-of-eviction-notices-could-be-illegal-says-law-firm

Little Change in House Prices Recorded by Land Registry

Published On: October 18, 2016 at 10:46 am

Author: Em Morley

Categories: Property News

Tags: average house price,house prices,property market,property sales

The UK House Price Index for August from the Land Registry and Office for National Statistics (ONS) shows little change in house prices over the most recent month for which data is available.

In August, house prices rose by an average of 8.4% on an annual basis, taking the typical property value in the UK to £218,964. Month-on-month, house prices rose by 1.3%.

House prices across the country

In England, prices rose by 9.2% over the last 12 months to an average of £235,573. On a monthly basis, prices were up by 1.4% on July.

Wales experienced an annual price increase of 2.7%, taking the average property value to £144,514. However, prices dropped by an average of 0.6% over the month.

Prices in London rose by 12.1% over the past year, putting the average property value in the capital at £488,908. Over the month, prices increased by 1.3%.

Regionally, the House Price Index found that the East of England experienced the greatest increase in house prices over the last 12 months, at 13.35%. Month-on-month, the South West recorded the highest growth, of 2.3%.

The lowest annual price growth was seen in the North East, at 3%, while the region was the only area to record a monthly drop in prices, of 0.2%.

UK property sales

Property sales across the UK rose by 8.4% in the year to August, up slightly from 8.0% in July. Although demand and supply were broadly unchanged on the previous month, the indicators remained

Little Change in House Prices Recorded by Land Registry

somewhat weaker than in 2015 and early 2016, according to the report.

Data for June 2016 – for which the most recent Land Registry figures are available – shows that the number of completed home sales in England dropped by 32.2% to 57,637, compared with 85,020 in the previous year.

The amount of property sales in Wales fell by 27.1% to 3,046, compared to 4,181 in June 2015.

In London, the number of completed home sales also dropped, by a huge 46.7%, to 5,966, from 11,202 in the same month last year.

There were a total of 526 repossession sales in England during June, with just 55 in Wales. The lowest number of repossession sales in England and Wales was in the East of England.

Little change in house prices

Katherine Binns, of the HomeOwners Alliance, responds to the figures: “The latest house price data released by Land Registry shows little change in house price growth in August. Since the referendum result, both house sales and house price growth have eased. However, low mortgage rates and a shortage of homes available for sale should sustain house prices.

“As the economy and employment have held up following the Brexit vote, it will be interesting to see whether confidence returns and begins to unfold in autumn housing market activity, as buyers take advantage of attractive mortgage rates.”

Seasonally acceptable picture of the market

The CEO of eMoov, Russell Quirk, also comments on the findings: “Today’s figures from the Land Registry portray a pretty seasonally acceptable picture of the UK market during late summer, but with prices up 8.4% annually and still up 1.3% over the slower holiday months, homeowners have a lot to be reassured by.

“Looking annually, it’s a pretty familiar picture with London, the South East and East of England all seeing double-digit growth in house prices. Perhaps a little more unusual when looking at monthly growth is London, seemingly rocked by the leave vote, with an increase of just 1.3%.”

He continues: “Although the East of England and South East both enjoyed strong monthly growth, there are a few unusual front-runners placing well in the regional house price race. Both the East and West Midlands enjoyed strong monthly growth, at 1.6% each, but perhaps the real standout story is the South West, as the only area seeing monthly growth tip over 2%.

“Who knows, this uncharacteristic rise to the top could be a result of South West holiday goers making some snap decisions whilst down in the likes of Devon and Cornwall over the summer.

“Regardless, we’ve just seen one of our strongest months performance wise, with sales and listings both well up on previous months. So any current myths of the UK market on its knees on either side of the fence at present are myths indeed.”

Uncertainty following Brexit

Additionally, the Co-Founder and Director of online mortgage lender LendInvest, Ian Thomas, reacts to the House Price Index: “August was a tricky month for the housing market, with the uncertainty following the Brexit vote adding to the traditional summer slowdown. It has been a feature of this year that the housing market has had to deal with a succession of external factors denting demand. The conclusion of the Help to Buy scheme at the end of 2016 will be another one, which may particularly affect the sale of new build properties.”