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Em Morley

Crossrail network to boost property prices

Published On: September 9, 2015 at 10:41 am

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The high-speed and controversial east-west Crossrail network is not due to launch until 2018, but is already putting property prices on its route on the right track.

Set to slash journey times across the capital, the network is also primed to engineer boosts to the values of properties.

Value

Ian Lindsay, the company’s land and property director, suggests that the Crossrail scheme will add £5.5bn to property values. This prediction comes as a stretch of 26 miles worth of tunneling beneath London comes to a conclusion, alongside the initial homes above a Crossrail station.

Crossrail’s line will run from Reading in the West to Shenfield and Abbey Wood in the East. It is hoped that this will greatly reduce journey times to London and add an extra 10% to the capacity of the Tube.

Hamptons International’s head of research, Johnny Morris, believes,’ the big change is in the built environment and areas around the stations.’[1] The regeneration is going hand in hand with the development of the new transport system, with 3.3million sq ft of residential office and retail space planned above Crossrail stations.

‘If you go back in time, railway has always created regeneration, as the Tube grew so did London, and this Crossrail programme will go through exactly the same experience again,’ said Crossrail chairman Sir Terry Morgan.[1]

Developments

In total, 57,000 new homes are to be built along the route, with councils upgrading their town centres. Savvy investors have already begun to snap in property in neighbourhoods which are to become prominent with the changes. Woolwich for example is primed to become a major transport hub. Its Crossrail station is being developed within 88-acre Royal Arsenal Riverside, a Berkeley Homes construction that will include 5,000 new homes when it is completed in the year 2030.

In excess of one thousand of these homes will be above the station and a huge 90% of the apartments located in Cannon Square have already been sold. Prices for the remaining three-bedroom, two-bathroom flats range from £647,5000 to £875,000 for a duplex penthouse.

Crossrail network to boost property prices

Crossrail network to boost property prices

‘Crossrail is without doubt the most important new transport infrastructure for London and the South-East for a generation. The new Crossrail station will make Woolwich one of the best-connected parts of the capital,’ said Karl Whiteman, managing director of Berkeley Homes.[1]

Price hike

In addition, Crossrail has received permission to build 400 homes at Armourer’s Court, in five buildings based on a landscaped garden towards the west side of the station. Since its approval in 2008, the total value of properties on the rail route have grown by around 20% more than capital appreciation in the capital and the South-East, according to property consultant CBRE.

CBRE also predicts that the Crossrail effect will aid property prices further. The firm predicts that prices will rise by an extra 13% by 2018, rising to 20% in London, adding around £100,000 to the value of each property.

[1] http://www.homesandproperty.co.uk/property-news/news/crossrail-effect-high-speed-east-west-rail-network-set-add-ps55-billion-property-values

 

 

Wealthy Foreign Students Spend £1,500 Per Week on Rent

Wealthy foreign students are spending over five times the average letting agent’s starting salary on luxury accommodation in London.

Students from China, the USA and India can spend up to £1,500 per week to live in Mayfair, Knightsbridge and South Kensington.

Over a year, this equates to a huge £78,000. According to the National Careers Service website, the average letting agent’s starting salary is only £15,000 per year.

Wealthy Foreign Students Spend £1,500 Per Week on Rent

Wealthy Foreign Students Spend £1,500 Per Week on Rent

Lettings firm EJ Harris conducted the research, finding that the 107,000 international students currently studying in the capital pay a total of £600m in rent.

Managing Director at EJ Harris, Elizabeth Harris, says: “There are over 100,000 international students studying and living in London, and their numbers are rising.

“University applications from overseas students are up by 18% since 2010 and up by 30% for the capital’s best universities.

“In our experience, international students make for extremely good tenants. They are very studious and take their studies in London extremely seriously.

“As tenants, they tend to be quiet, hard-working and tidy. Smoking tends to be the only common vice.”1

EJ Harris’ figures used data from its own client instructions over the past three years and Government statistics, showing that 40,000 of the foreign students studying in London are from continental Europe and 67,000 are from the rest of the world.

The largest proportion of international students is from China, at 18%. Of the rest, 9% are from the USA, 7% from India, 5% from Hong Kong and 4% from both Malaysia and Nigeria.

Other significant countries are Saudi Arabia, Singapore, Pakistan and Canada.

EJ Harris found that around 20% of its inner London clients were students, of which 50% were foreign.

The students are typically aged between 18-22 and the research suggests that most accommodation was paid for “by the bank of mum and dad”.1

Some students receive grants from their respective countries.

1 http://www.propertyindustryeye.com/wealthy-foreign-students-spending-1500-a-week-on-rent/

 

Tenant Shocked at Letting Agent’s Demeaning Email

Published On: September 9, 2015 at 8:57 am

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A tenant was shocked to read an email from her letting agent, in which she was called a “bitch”.

Sarah Darlington was apparently copied into the email by accident, with the message stating: “I’m not dealing with this bitch.”

The 29-year-old para-legal had asked S & S Estates in Prestwich to fix an alarm.

She says: “It is unbelievable. I would be fired on the spot if I acted that way in my job. Not only is it completely unprofessional but it also shows how they work in the office.

“The only thing I did was to send them a polite email asking them to fix the alarm. I did not deserve that treatment.

“After getting the message on Thursday night, I found the company’s directors and emailed them as well as the manager, but all I got was a reply on Friday afternoon saying the complaint had been passed on.

“There was no apology, it’s disgusting.”1

After not receiving an apology, Sarah posted the email on her Facebook page.

1 http://www.propertyindustryeye.com/tenant-stunned-to-find-herself-described-as-bitch-in-email-from-agent/

Renting from Rogue Landlords is Not a Choice for Many Tenants

Published On: September 8, 2015 at 5:43 pm

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Those that believe there is no housing crisis in Britain typically accept that there are three main tenures available in the UK: renting from a housing association or council, homeownership or renting privately.

These are the people that assume those not locked into homeownership can move around an endless supply of private rental sector properties as they wish.

Renting from Rogue Landlords is Not a Choice for Many Tenants

Renting from Rogue Landlords is Not a Choice for Many Tenants

But judging by recent research from housing charity Shelter, private tenants don’t really have a choice when it comes to renting from rogue landlords. In the last year, 17,000 renters called Shelter’s hotline for advice on landlord harassment. Issues included verbal abuse, threatening behaviour, having utilities cut off and even burning of personal belongings.

These stories are unsurprising, as many people that have rented privately have had difficult relationships with their landlords.

Although the number of landlords harassing tenants is small, it is not insignificant. Renters can often have no choice in who they rent from, as competition for rental property is strong.

Additionally, the relationship is often weighted in the landlord’s favour; just a small disagreement can lead to the landlord evicting the tenant, and with them potentially a family or housemates.

These revenge evictions can strike hard; imagine being told you have just five days to find a new place to live, with the person kicking you out owning the rights to the property and with it, much more capital than you.

Many argue that tenants can leave their home when their contract ends and move around freely, but this freedom is only accessible if you can raise a deposit and afford a similar home in the area. Many renters don’t.

When beds in sheds stories enter the news, homeowners may ask: Why do people choose to live like this? What they may not realise is that renters often don’t have a choice.

Tenants rarely feel equal to their landlord. Renters are fighting for accommodation due to the housing shortage, and while they compete, landlords will take advantage.

It appears that the only solution is to create a healthier relationship between landlords and tenants, and a means of this may be to increase tenants’ rights. If renting is not skewed by threatening landlords, tenants may feel they actually have a choice.

 

 

Landlords to benefit from second charge market?

Published On: September 8, 2015 at 4:54 pm

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New research has indicated that remortgage or further advance customers could benefit from taking out a second charge loan.

V Loans estimates that this could be the case for nearly 10% of consumers.

Opportunities

The secured-lending specialist believes a mix of record law interest rates in the second charge market, coupled with the strong growth of the sector from 2011 gives an indication of the benefits for customers, alongside opportunities for brokers.

In addition, landlords could also be set to benefit from further competition in the buy-to-let second charge market, which could lead to significant price reductions. What’s more, this could make second charge lending a more attractive alternative to remortgaging, which could allow landlords to benefit from the heightened equity within their current portfolio.

On course to hit £750m in lending this year, the second charge market has seen year-on-year growth since 2011. Rates have fallen to record low of 4.05% above base rates, making the case for lenders to take out a second charge, while not causing any detriment to their withstanding mortgage arrangements.

With this said, V Loans predicts that only 50% of advisors promote second charges to their clients and as such is urging advisors to think of the benefits of these loans.

Landlords to benefit from second charge market?

Landlords to benefit from second charge market?

Best interests

‘Remortgaging or taking a further advance is not always in the client’s best interest and therefore it’s essential that all options are considered,’ said Marie Grundy, Managing Director of V Loans. ‘Interest-only customers, those benefiting from lifetime trackers and low fixed rate deals or those who do not want to incur substantial early repayment charges by remortgaging, including landlords who wish to release trapped equity, could all stand to benefit from second charge finance.’[1]

‘The pending alignment of regulation for first and second charge markets will deliver huge opportunities and innovation to the market allowing advisers to provide better customer outcomes. Intermediaries should seriously consider including second charges within their scope of service ahead of the regulatory changes next year,’ Grundy added.[1]

[1] http://www.propertyreporter.co.uk/finance/could-landlords-benefit-from-the-second-charge-market.html

 

Green Party Co-Convener Calls for Fairer Housing in Scotland

Published On: September 8, 2015 at 4:47 pm

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Maggie Chapman is a co-convener of the Scottish Green Party. She is calling for a fairer housing system in the country in the wake of the Scottish Government’s announcement to legislate rent controls.

Chapman is “delighted” that Scotland will soon introduce rent controls. However, she urges that they must be “real and meaningful, and tackle the serious housing problem we face.”

Chapman explains her viewpoint: “Better housing is a fundamental part of a better society; it is hard to see how we can improve people’s health, better educate our children and have a fairer and more equal economy if we fail to offer people decent homes.”

Housing in Scotland has followed the general pattern of the UK, with many homes now being rented out by private landlords.

Wealthy property investors are experiencing “profits rising year-on-year,” says Chapman. For those renting from them, the costs of letting eats up “greater and greater amounts of people’s disposable income”.

Green Party Co-Convener Calls for Fairer Housing in Scotland

Green Party Co-Convener Calls for Fairer Housing in Scotland

The young and those on low incomes are being priced out of homeownership by spiralling prices. Renting in the private rental sector has become “the norm”. But Chapman notes, “all too often, the property for rent is cramped, expensive and low-quality”.

Scotland is now facing a housing crisis. Chapman observes that in cities such as Aberdeen, rents have surged, pricing all but the very wealthy out of the city and causing “social segregation”.

The HomeLet index shows that rents around the UK have increased by 12% in the last year. Chapman argues: “When it is cheaper than ever to borrow money, there is no excuse for this.”

She continues: “In a society where many people under the age of 35 find themselves priced out of buying a home, we risk creating a cohort of people permanently locked into high-cost housing.”

But those affected have reacted, with many running campaigns. The Living Rent movement has forced the issue up the agenda and is hoping for a serious response from the Scottish Government.

Although Chapman believes in the power of rent controls, she hopes that they are “effective”.

“That’s why I put forward a motion to the Scottish Green Party conference next month, calling for the introduction of a points-based system of rent controls,” she explains. “This would mean that rents are set at an affordable level, based on the quality, size, location and facilities in the property for rent.”

She adds: “I want increases to be limited so they don’t push tenants into poverty.”

Chapman is also addressing evictions. At present, there is a no fault ground for eviction, meaning that landlords can remove their tenants whatever their circumstances.

She says: “I want all evictions to be discretionary, so landlords must give grounds for removing someone from his or her home.”

Additionally, Chapman would like to see the regulation of letting agents.

She continues: “This boom sector mediates the market, producing a situation where they are demanding rent increases that not even the landlords want.

“In one case, I was approached by tenants whose letting agent was terminating their lease because they’d lived in the property for two years, and the agent was worried they would start treating it as a home. It turned out that the landlord didn’t want them removed. It was a ruse to put the rent up.”

Chapman concludes: “Ultimately, housing is the cornerstone of a good society. While Thatcherites may delight in the rich profiting from an unprecedented transfer of wealth from the poor, we cannot allow neo-liberal dogma to condemn the young and the poor to expensive, low-quality housing.

“We need rent controls, an end to unfair evictions, and a radical overhaul of the housing system. This decision is just the start.”1

1 http://www.theguardian.com/housing-network/2015/sep/07/rent-controls-scotland-fairer-society-nicola-sturgeon