Henry Knight from Springtide Capital provides an update on the UK mortgage market:

With a positive first quarter behind us and the weather brightening up, we at Springtide Capital are pleased to report some much needed good news. 2013 so far has seen more lending, lower rates, and crucially more people than ever entering the housing market, even with more complicated financial circumstances.

The first quarter’s greatest triumph came in the decision by the Bank of England to extend its Funding for Lending scheme, giving the housing market a much needed boost.

The effects of Funding for Lending are being felt nationwide as lending increased 9% from February to March alone, whilst gross lending totalled £33.8 billion for the first quarter. These figures from the Council of Mortgage Lenders highlight the increased number of products currently available for people, who up until now have been trapped in a cycle of renting or are stuck in their first home unable to move up the housing ladder.

We were delighted to hear the news earlier this week that Halifax would be paying up to £2,500 to cover the cost of tax on property purchases of between £125,000 and £250,000. This stamp duty cash back scheme is something which we all must commend and will hopefully see replicated across the other lenders. Halifax’s announcement provides further evidence of the positive effects of funding for lending, as competition increases and the lenders have to work harder for your business.

Despite Halifax’s bold move to attract more first time buyers, we must profess that so far this year it has been the smaller lenders who have really been forging ahead, offering flexible products, higher loan to value mortgages and the best rates on the market. Chelsea, Yorkshire and Cheltenham and Gloucester building society are all offering mortgages with rates below 2% – something simply unheard of at this time last year. The lender’s increased efforts to attract business at the bottom end of the market should begin in turn to have a knock on effect at the middle and higher tiers, enabling second or third home owners to move on up the ladder or to downsize, depending on what suits.

Our advice therefore remains simple, if you are debating whether or not to buy, now is a great time to do so. Doing some research into finding the right mortgage broker will pay dividends, as they will help you in securing the most appropriate product and put you in good stead with the estate agent. 2013 is proving to be an excellent year for the home owner, so if you haven’t already, I suggest you seize the moment and take advantage of some of the excellent deals available to you; whatever your financial situation.

Contact Henry

• Henry Knight

  Managing Director – Springtide Capital Ltd
  Henry Knight is Managing Director of Springtide Capital, a mortgage broking business specialising in the mid to top end. Springtide was established in January 2005 as Cluttons Private Finance and was renamed in 2011 following a deal struck with Chesterton Humberts to purchase a significant stake in the firm. Now trading in London, Edinburgh, Sevenoaks and Taunton the firm has expanded its numbers and continues to grow their reputation within the market for high quality prime business.

David Hebditch, Head of Rural Division, writes about the impact of the disastrous 2012 harvest, and how this year’s spring has only made the situation worse.

This spring’s Landplan aims to give you all the information you need to know about the Rural market. The result of one of the wettest autumns and winters on record from 2012 has added pressure to all sectors, resulting in a shortfall of autumn cropping and the livestock sector struggling with winter forage. To date the late spring has simply compounded the problems of the autumn and winter. In the north of the country the extreme late March snowfall has brought about the loss of many tens of thousands of stock and the continued low temperatures have meant that spring crops that were drilled in late February have yet to emerge.

It is no wonder then that farm borrowing has risen by 10% year on year. We therefore look forward to a break in this cycle over the next month or so, allowing for businesses to gain some confidence that 2013 will be manageable, although sadly most businesses are already predicting a below average result. The industry is however, if nothing else, highly resilient and whilst conditions have been extreme, farming is used to the challenges of unpredictable weather.

Land Values

In total contrast to the above, land values and land ownership continues to bloom and grow vigorously. The advantages of land ownership and the security that it provides compared to other investments still remains. According to our research department, average farmland values have reached a new record level of £8,520/acre. As outlined in our Farmland Market Review, the growth in land values has demonstrated that land outperforms numerous other assets and thus has attracted a wide range of prospective purchasers and investors. In the current economic climate this growth and security provides bedrock to the industry and comfort to concerned farmers and their banks alike.

Proposals to help farmers

The ongoing saga over CAP reform continues, with it looking highly likely that any changes will be delayed until 2015. Over the past months, negotiations appear to be resolving various outstanding issues helped by a recent agreement on the overall EU budget for 2014 – 2020. Defra secretary Owen Paterson promises that he has secured the right for countries to introduce their own greening scheme rather than being tied to environmental measures devised by Brussels. Whilst such proposals appear helpful and encouraging, pressure needs to be applied to Defra to ensure that such schemes are not gold plated in return for payments. As ever, farmers and land owners should maintain a keen interest in the ongoing discussions to ensure that come the introduction businesses have planned appropriately.

As anticipated, the recent budget offered few surprises and little help to the industry. It was always clear that the Chancellor had little flexibility available to him and those small cuts that were introduced are likely to be delayed until 2014 or beyond. The Government is, however, attempting to assist in other ways and changes to the planning regime, including permitted development rights may well provide opportunities for land owners and farmers to draw on new income sources from their assets.

 



Contact David

• About David Hebditch

  Head of  Rural – Chesterton Humberts

  After graduating from the Royal Agricultural College in 1982, David joined Humberts in 1983 and was the company’s interim Managing Director prior to the merger with Chesterton in 2009.

  Specialising in the sale and purchase of farms and estates, rural planning and valuations, David is now Head of the Rural and Regional Professional Services Division as well as being an active member of The Royal Institution of Chartered Surveyors, sitting on its Rural Policy Panel.

Judy Pearson, an Associate based in the Rural team in our Stamford office, explains the vital differences between grazing licences and land tenancies, as the grazing season starts:

Grazing Agreements

At this time of year, those of us in the agricultural sector are beginning to look at grazing licences or are congratulating ourselves for having already arranged them for the coming season. The typical grazing season runs from spring to autumn and although many arrangements are made privately between parties,  some are publically let and many are put in to a grazing auction.

When looking at grazing licences, the most important thing is to ensure that it remains a licence and doesn’t become a tenancy. But what is the difference?

Licence vs Tenancy

A tenancy is described as “exclusive possession for a term for a rent”, which is pretty self explanatory really. For example, if you are letting one person a paddock to graze their horses and they pay rent and look after the up-keep of the land, it is likely to be a tenancy.

If, however, you are letting a paddock to various people, each with access and not undertaking any maintenance and not paying anything then it is not a tenancy and is probably a licence.

A licence enables someone other than the owner to graze the land or take a cut of grass. These arrangements should be for less than a full year because if they run year to year then in reality, they are more likely to be a tenancy. With a licence, the grazier pays a licence fee rather than a rent and isn’t responsible for any maintenance of the crop or to the land / fencing etc. – that is all the responsibility of the owner.

Profit à prendre’ vs Grazing Licence

Similar to a grazing licence is a ‘profit à prendre’ agreement. A profit à prendre, or ‘profit of pasturage’, is the right of a grazier to remove grass from the land by grazing. One important distinction between a profit à prendre and a grazing licence is that the latter often allows the grazier to mow the grass whereas profit à prendre agreement typically does not.

Both types of agreement can include the right to mow, although a concern has been expressed in the past that the right to mow may make it harder for the owner to claim that he is in charge of grass husbandry – see the difference between a tenancy and a licence above. Obviously, the possible issue with mowing should be considered with both profit à prendre agreements and grazing licences.

Why does it matter whether it is a licence or a tenancy?

The simple answer to this is tax and subsidies. If a grazing arrangement is genuine, then the owner can claim Single Payment Scheme subsidies and Environmental Stewardship grants and will likely retain the Agricultural Property Relief of the land and farmhouse for Inheritance Tax as well as other tax advantages of farming the land in hand.

With a tenancy arrangement the owner may lose trading status for Income Tax and VAT. There is a risk that the Agricultural Property Relief for Inheritance Tax for the farmhouse could be lost if the land is let away from the house. With a tenancy, the tenant must claim Single Payment Scheme subsidies and Environmental Stewardship grants rather than the landlord/ land owner.

Be aware that HMRC will always look at what exactly is happening on the ground rather than relying on the paperwork put in place. For example, if you take a grazing licence as a grazier (on paper, signed and sealed) but you are carrying out repairs and maintenance to the land then you are likely to have a tenancy rather than a licence with the owner and HMRC will treat it as a tenancy rather than a licence.

This is a very complex area of land law, but this blog gives some idea as to why it is important to know whether you want or have a licence or a tenancy. There are also other farming arrangements available such as contract farm agreements or share farming agreements. If you have land that you are letting you should definitely consider all of your land management options to see which is the best financial and tax beneficial option for you.

 



Contact Judy

• About Judy Pearson

  Associate, Rural, Stamford- Chesterton Humberts

  Judy Pearson is an Associate in rural department of the Stamford Office. She is a Chartered Surveyor, Fellow of the Association of Agricultural Valuers and a member of the Agricultural Law Association. Judy joined Chesterton Humberts in the summer of 2012 and works in all areas of rural practice including land and tenancy law,  rural planning and valuation. Judy also writes her own blog on rural matters, available from: http://blondeagadvisor.wordpress.com/ and has a Twitter: @blondeagadvisor

It’s always nice to win awards, but few are as satisfying as the one that Chesterton Humberts was presented with this week at the prestigious RESI Awards: ‘Letting Agency of the Year’. This award recognised the outstanding service that our lettings team provide clients and tenants day-in and day-out and also the sterling work that our back-office staff in our renewals, client accounting and property management departments.

In announcing the award, the judges noted what a remarkable year 2012 was for Chesterton Humberts, with a record number of properties let and managed, and they commended our focus on customer service, describing it as simply “superb” and also the amount of investment we have made in training all of our staff to the highest standards.

With a lettings business built on highly-trained, knowledgeable and experienced staff; a network of 32 lettings offices which stretches across London and the south; a genuine focus on providing unparalleled levels of customer service; and an appetite for innovation, Chesterton Humberts is a worthy winner.

Going into 2012, there was a lot of excitement surrounding the Olympics lettings market. This excitement inevitably led to hype, with many professional and buy-to-let landlords, not to mention opportunistic homeowners, looking to exploit the situation for short-term financial gain.

Unlike many of our competitors, our experienced and professional lettings staff recognised the risks of inflating prices and terminating tenancies, as many landlords were inclined to do, and foresaw that the potential surplus of stock after the event would probably lead to falling prices. So, whilst setting up a special ‘2012 Lettings’ department to cope with additional demand, we were careful to advise all landlords of the risks – a position which was soon justified as it became clear that the demand for properties in central London was not as strong as initially anticipated.

Despite this, our special 2012 lettings department negotiated a number of notable Olympic-related deals over the summer including:

• A 7-bedroom property in Cheyne Place was let for 16 days at £32,500/week
• 14 x 2-3 bedroom flats in Westminster were let to a single tenant
• Having developed a close relationship with LOCOG over the past three years, we agreed over 33 deals with this client

Other, non-Olympic, landmark lettings deals included:

• A 4- bedroom in Knightsbridge at £23,400/month
• A 4- bedroom in Camden at £9500/week
• A 5- bedroom in Lincolns Inn Fields at £9517/week

Aside from the Olympic hype, the continued strength of the lettings market, combined with the increased availability of finance, has encouraged many more amateur landlords into the market. To enable them to advise and assist these clients intelligently, our sales negotiators are working closer than ever with their lettings counterparts and have been trained to offer rental market advice, yield forecasts and to understand the lettings process in general.

Over the past 12 months, we have increased the investment in our lettings staff and encouraged their personal and professional development with specialist training courses provided through our dedicated in-house trainer. These courses cover a wide variety of subjects and include Basic Lettings; CHILL (Chesterton Humberts Intermediate, Lettings Legal); Advanced Legal; and Possession & Court Proceedings and help our staff offer a superior service to our clients. Additionally, we train and encourage all staff to enter for the NAEA Technical Award and this year achieved record high scores and a 96% pass rate.

With our emphasis on customer service, we set up a special ‘Service Improvement Group’ to analyse responses from our new quarterly Customer Satisfaction Surveys. This allows us to gauge current levels of service, to identify and implement ways in which the client and customer experience can be improved.

In addition to its traditional agency work, Chesterton Humberts offers its clients a full and continually expanding range of complementary services designed to help maximise returns whilst taking away as much hassle as possible. These services include Property Sourcing, Refurbishment, Management and PRIME, a department set up to service our portfolio landlords.

To increase the efficiency and reduce the inconveniences associated with the lettings process, we use special software to allow our clients and tenants to securely sign paperwork electronically.

The strong performance of our lettings department has allowed us to open new offices in Kew (2011) Kensington and St John’s Wood (2012) and firmly establish ourselves as the market leader by transactions in the majority of our North and East London offices, with other areas also rapidly gaining market share. Having only opened last May, our St John’s Wood office has performed especially well and has already gained dominance in the local market. In June we will open in Notting Hill in order to serve our clients better in that locale.

Chesterton Humberts prides itself on its dedication to providing the highest quality service and it is great to have this recognised by industry experts. This award is a huge achievement and shows how hard the entire team has worked to innovate and improve our service, to keep ahead of some very strong competitors. I am extremely proud of the department, which is not only incredibly knowledgeable and professional, but also willing to go out of its way to meet the needs of our clients.

 



 

Contact Robert

 

• About Robert Barlett

  CEO – Chesterton Global Ltd
  ^{Appointed CEO of Chesterton in September 2006, Robert has spearheaded the dramatic growth in Chesterton and was instrumental in the acquisition and merger of Humberts in December 2008. Robert became Group CEO for Chesterton Global Limited in 2007. He was previously CEO, Residential for Cluttons LLP where he was an equity partner and has a background in investment banking and brokerage within the United States. Robert rowed internationally and represented Great Britain in the 1992 Olympic Games.}

Colin Tebb, an Associate at Chesterton Humberts Salisbury, explains how amendments in planning rules can benefit those with land around large settlements:

The Government’s latest guide on planning regulations, the National Planning Policy Framework, or NPPF, highlighted the need for a new approach to planning in England and Wales that works at ground level and allows local people to decide what goes on in their neighbourhood with regards to new housing, and how existing buildings are used.

The lynchpin of this new approach is ‘Neighbourhood Plans’. These are basically documents that set out a vision for a specific neighbourhood and they generally include general planning policies for the development and use of land in the neighbourhood and will also often earmark certain sites for development.

If adopted, these plans will then form part of the overall development plan for the borough and will be used to assist in the determination of all planning applications in that area. However, a neighbourhood plan cannot stop development and government has made it clear that it is not a tool for residents to oppose proposals for new developments close to them.

As a starting point, all council are required to carry out a Strategic Housing Land Availability Assessment (SHLAA) which needs to include a calculation of their supply of land for housing over five years. However, if councils do not currently have a five year supply, then landowners, developers and private individuals can put their sites forward for new housing. And, if successful, they will enjoy a substantial uplift in the value of that land.

For example, my team and I have recently been working for a client who owns an eight acre site in the South Somerset area, where the Local Authority has indicated that there is a housing shortfall of 90 residential units (which could be houses, flats etc.) and have simply said it is for each landowner to explain to District Council why their site is ‘’viable, deliverable and developable’’ to provide these.

In cases such as this, it is a race to promote your site ahead of any other sites in the area. The first step is to undertake what is now called ‘Stakeholder Engagement’ , which basically means meeting the Parish Council, local Ward Councillor, local residents etc. to involve them with how a site could be developed.

With this particular case, we have instructed a local architect to prepare a masterplan for the site and scoured the local Parish Plan and recent Parish Council meeting minutes to establish what ideas residents already have regarding housing, employment, schools, highway safety and other such issues.

Essentially, by listening to the local community and encouraging their involvement, my team and I are working to try and ensure our client’s site is the preferred site for development.  We hope to be in a position to submit a planning application later this year and when we do, we will very likely have the support of the Parish Council, local Councillors and local residents which will of course improve our chances of securing the desired permission.

 

Contact Colin

• About Colin Tebb

  Associate, Salisbury – Chesterton Humberts
  Colin Tebb, BA(Hons), Btp, MRTPI, is also a qualified Chartered Planning Consultant. Working from our Salisbury office with a dedicated team, he is highly effective and has an in-depth knowledge with solving planning issues, keeping up to date with all new planning progressions.

Ian Westerling, South East Area Director for Chesterton Humberts, shares his top tips for the perfect spring clean; to make your home look its best and create that all-important first impression. Preparing your home for sale is not a case of simply vacuuming the stairs and placing fresh flowers on the living room table!

Exterior Appeal

The importance of first impressions cannot be understated, as a property’s curb-appeal can make prospective buyers feel positive about the property even before they walk through the door. Paint the front door and window frames, clear the pavement of rubbish and weeds, mow the lawn, remove dead plants or flowers, trim bushes and hedges. None of it costs much but can make a huge difference.

Make Your House Sparkle

Properties need to be immaculate so that buyers can see the full potential; serious attention to detail is required – especially if you are a smoking house or have pets! Before each viewing, dust everywhere, from skirting boards to furniture to lights; vacuum thoroughly and air out any musty smelling rooms. If you do opt to use a fragrance, don’t be too liberal otherwise buyers may be suspicious of what you are trying to cover up.

According to Rightmove, dirty kitchens and bathrooms are buyers’ biggest turn-offs so pay special attention to these rooms; bleach the grouting, clean the windows inside and out, polish taps and mirrors. In the kitchen, wipe the inside surfaces of the fridge and place an open box of baking soda inside it to soak up odours. Buyers can be nosy and poke around so don’t forget to clean ovens and cupboards!

De-personalise

Too many personal items can detract from a property so consider packing up things like holiday souvenirs, photographs of family, friends and pets, and definitely remove the children’s drawings/paintings pinned to the fridge door. Buyers want to be able to picture themselves living in your building home and that can be made harder if your personal items are distracting them.

De-clutter

You want each room to feel as light and spacious as possible, so get rid of all the unnecessary bits and pieces you have accumulated. Clear everything on kitchen counters, pack away knickknacks and remove CDs, DVDs and books off bookcases. Throw them out, donate to charity or store neatly in a cupboard; if you don’t need, want or use them now, chances are you won’t in your new home!

Maximise Light

Lots of natural light tends to be important to buyers which I appreciate can be difficult for some. However, it’s amazing what a few simple tricks can achieve: replace dim light bulbs with higher wattage; replace dark heavy curtains with lighter ones; repaint dark rooms a lighter colour; and cut back any trees that cast shadows into your rooms.

Minor Repairs

Now is the time to face all those niggly DIY things that you have been avoiding: replace broken light bulbs, fix broken drawers, doors and leaking taps;cracks in the walls will need filling and so will the holes left by picture frames ; replace cracked tiles and you may want to consider replacing tatty wallpaper, worn cushions, bedspreads and curtains.

The Green Appeal

Don’t forget the garden. Similar things can be done at the same time as the frontage, but also ensure all clutter is cleared away into the shed, such as children’s toys, bikes and gardening tools.

Once you’ve done all of that you deserve a pat on the back. Not only would you have had a good work out, your home should be ready to showcase. Never underestimate what a good Spring Clean can do – it may well be the difference between an asking price sale and no sale at all!

 

Contact Ian

• About Ian Westerling

  Area Director, South East – Chesterton Humberts
  Ian has been trading in the home counties for over 25 years with extensive experience of selling prime property across the south east. He is highly effective at managing, motivating and leading staff for the greater good of a common goal and has an in-depth experience of dealing with acquisitions, expansion, cold starts and business planning. He is currently the Area Director for Chesterton Humberts in the South East.

The housing market shows continued signs of recovery, however, there remains considerable regional variation. HMRC reports that transaction numbers rose by 6.3% in February; which is up by 7.3% compared to February 2012. Whilst Land Registry data points to modest price growth – average house prices rose by 1% in the year to end-February 2013 and by 0.2% in the month of February itself.

The Government is helping the recovery process via its various schemes designed to facilitate access to mortgage finance, most recently with the Help to Buy scheme as announced in the Budget. Despite criticism from some quarters, these initiatives have resulted in a raft of record low fixed rate mortgage deals being offered by lenders, whilst also engineering high loan-to-value ratios, therefore alleviating the deposit hurdle for many new buyers at the lower end of the market.

More now needs to be done on the supply side to eat into the housing shortage, and to ease potential inflationary pressure on prices, as more households become in a position to buy. Surplus public land needs to be released, much more quickly and with fast track planning consent. Developers could perhaps be incentivised by being offered land at below market rates, with the Government taking a proportion of the profit as payback. The Government could also help developers’ finance by forcing banks to allocate a proportion of their loan books to residential developers.

The issue of regional variation in the housing market will be a tougher nut to crack. Market performance is fundamentally determined by the health of the economy. If people are concerned about losing their jobs or if their pay is failing to keep up with inflation, then even if favourable mortgage deals are available, households will hesitate to commit to any significant financial burden.

This largely explains why the London market, with its relatively strong economy, remains an oasis compared to the rest of the country; plus the high proportion of demand from international buyers, which has helped to inflate prices. The South East market has benefited from the trickle effect out of London, with the huge commuter workforce which retreats to the leafy suburbs at the end of the working day.

In contrast, a recent report from debt charity Stepchange, highlights that despite lower property prices, regions in the North of England, Scotland, Wales and Northern Ireland all have higher than average proportions of mortgages; many with payment problems for loans taken out between 2005 and 2010. Northern regions are also the most affected by negative equity, with above average proportions of “mortgage prisoners” in the North East, North West, Yorkshire, Wales and the Midlands.

Contact Nick

• About Nick Barnes

  Head of Research – Chesterton Humberts
  Nick has over 20 years experience within the property research arena, having worked for DTZ and Knight Frank before moving to Chesterton Humberts to head up the Research Department. His career has covered both the commercial and residential sectors in the UK and international markets and includes market research covering investor and occupier markets. He has additionally provided bespoke consultancy services for major investors, developers and lenders.

  Nick is passionate about research, without which he believes it is not possible to take balanced decisions regarding any property transaction. It is his long term aim to try to help elevate residential property research up to the same standing as that of the commercial property sector.

  Outside of work, Nick is equally passionate about sport and photography and is partial to the occasional glass of red wine!

Philip Greenway, Associate Director for Chesterton Humberts Taunton comments on how barn conversions remain ever popular with the Sales and Lettings markets.

Over the past 20 years there has been a boom in barn conversions and that trend seems set to keep on going. The aesthetic appeal of a rustic, full of character yet comfortable home isn’t hard to understand, but there are many practical reasons why people are turning to buy conversions as family homes and increasingly for letting.

DESIGN FEATURES

The distinctive design, with interesting character and period features such as exposed beams, stone walls and high, spacious ceilings is a barn conversion’s key selling point. Living space with such character can take practical, modern-style furniture or the more traditional and set it off to its best advantage, creating a home with a special feel that is hard to replicate in modern houses. The use of timber and stone surfaces within the interior, especially in kitchens, complements the original rustic building and can add a tremendous ‘wow-factor’ when framing sleek, contemporary appliances.

The original design of the buildings, and restraints that result from this design, can also lead to fantastic architectural innovations such as large open cart doorways that can be filled with glass to flood the space with light and suspended walkways or galleries that can be used to connect first floor bedrooms while providing views into the downstairs living space. With the ever broadening choice of modern fittings on offer, there is an opportunity to start from scratch and create a truly spectacular property.

SAVING YOU MONEY

Due to Building Regulations, barn conversions built in the last 5 -10 years have had to incorporate high levels of insulation and consequently provide warm and cosy living conditions that are cheaper to run than older properties.

In addition to the common oil fired boilers for central heating, some barn conversions now even have energy efficient ground or air source heating systems which not only provide cheap and reliable heating but are also a greener option. Occasionally, the usually design-driven inclusion of a wood burning stove can come with the added bonus of supplementing your heating; a great way of warming your living space with a rustic feature that suits your conversion (and not relying on the central heating).

THE RENTAL MARKET

Barn conversions are a big draw to not only holiday renters, but also to longer-term tenants. While a barn conversion’s appeal lies in its uniqueness and its rural charm, not to mention the often stunning locations, most tenants have the added satisfaction of knowing that the appliances and fixtures are modern and relatively newly installed. This, in turn, means less upkeep for them and reduced maintenance strain being placed on landlords than by most older properties. Character, design and a well-maintained property all adds up to the fact that, despite being outside of a city, one can ask a relatively high rent for a conversion that is sure to be sought-after.

CONVERTING A BARN YOURSELF

Converting a barn is an attractive prospect, either as a family home, an exercise in design or, indeed, as a rental investment. The opportunities are endless, so I’ve put together a checklist of things to consider and help your conversion go a bit more smoothly;

• Local amenities:  Schools, transport and even the location of the nearest supermarket are important. Beautiful rural scenery is wonderful, but only if you can live there comfortably.
• Local utilities: Check to see if the electricity and water will be easy to connect up, in order that you can live your everyday life as normal.
• Listing & Planning permission: Enquire to see whether your dream barn conversion is listed before you start planning any work. This will save a lot of hassle in the long-run. In the same vein, planning permission that has already been granted will smooth the way in your conversion, and may even give you a few ideas.
• Budgeting: The big one with conversions; account for everything possible, including wildlife surveys, payment for right of way etc. Also budget for use of original and hard-to-find materials, which will increase your barn’s value and get you on the planners’ good side.
• Architects: The lynchpins of the project, especially if you haven’t navigated these waters before.  Make sure they’ve worked on barn conversions previously and can draw up detailed start-to-finish plans that they can discuss and amend with the planning department.  If you want to make the most of your space, these are the people to help you.

Of course, if doing a barn conversion yourself is intimidating, then keep a look out for ones coming on the market now; either to buy or let, they offer a unique space to make a home. Chesterton Humberts currently have a large selection of barn conversions that will make the idea of a home in a rural idyll reality.

Contact Philip

• About Philip Greenway

  Associate Director Taunton

  Philip Greenway is Associate Director of the Taunton Lettings Office, a Chartered Surveyor and ARLA qualified. The busy Taunton office deals with middle and high end properties in the Central and West Somerset area. With its rural hinterland the office has a number of Farming clients and many have wonderful barn conversions which are available to let. There is a good selection of barns available at the moment with very appealing layouts and internal features.

Tanya Sutton, Country Lettings Director for Chesterton Humberts comments on the outlook for Lettings in 2013.

Over the many years that I have been working in the lettings industry, I have seen the market go through some massive changes but have a feeling that the current trend of tenants opting for longer term tenancies and acting more and more like buyers of properties could be one of the largest fundamental changes to the lettings market that I am likely to witness.

Given the affordability issues surrounding the sales market, renting is becoming an increasingly popular lifestyle choice and tenants are seeing rented properties less as a short-term fix and more as a longer-term solution, often choosing to pay more than they would under a mortgage. In fact, while private lettings have increased in popularity by over 8% since 1992, property ownership is down from 71% in 2003 to 65.3% in 2012. Figures also show that 15% of current tenants have been in their residence between 5-19 years – a figure which is predicted to rise over the coming years.

With this shift in attitude, there has been a definite shift in behaviour, and we have found that applicants are unwilling to make snap decisions about properties which could be their home for more than just one or two years; they are no longer persuaded by the “take what’s on offer” mentality and are less likely to make big compromises. As in the sales market, emphasis is now on being near to good schools and local amenities rather than just purely price and general location. This means that tenants are now viewing more properties and taking longer to find make a decision.

In light of this, landlords need to ensure that the agent they choose to market their properties for rent are able to more than match their sales counterparts when it comes to local knowledge, experience and especially service.

WHAT TODAY’S TENANTS ARE LOOKING FOR

Landlords looking to invest should bear in mind that there are certain properties which are proving especially popular with applicants. One of the key features is that property does need to meet modern demands, as tenants are searching for a home not just a house. Factors in high on the wish-list include:

• Good quality decor with modern finishes
• Adequate heating
• Manageable gardens
• Space for a family car
• Location and good commuting links

THE LETTINGS MARKET IN 2013

The lettings market last year was strong but unusual, with people trying to move as quickly as possible before major events; such as the rush with people trying to find a home before the effects of the Olympics. Strangely, we found the traditionally busy summer months unusually quiet, but we then enjoyed a very busy winter market; which saw people moving due to changing circumstances, such as family or employment. These factors are sure to impact the market in the coming year as well.

Another good indicator for the 2013 letting market is that applicant levels are strong while stock remains low, which isn’t ideal for tenants but does mean that the lettings market is set to achieve strong prices, driven by demand and balanced delicately with affordability.

THE REGIONAL LETTINGS MARKET

With the majority of our branches serviced by mainline railway links that offer an easy commute to the capital, many of Chesterton Humberts’ regional landlords have in fact benefitted from the economic crisis as applicants have started broadening their search to outside of the M25, in order to achieve a balance between commuting and costs.

This is good news for landlords, who will find greater security in these long term tenancies, something worth bearing in mind if looking to invest in the country market. Although there may not be quite the same profit margin as the London market, there is considerably more security and far less hassle and administration which goes with each turnover, meaning that landlords can enjoy longer periods of rental income with little disruption.

THE IMPORTANCE OF CHOOSING THE RIGHT AGENT

Successful lettings agents can’t just rely on sporadic surges of demand and low stock; the emphasis at Chesterton Humberts remains firmly on providing quality services and developing long term relationships with both tenants and landlords. Despite limited residences available, applicants are very well informed regarding their options and are holding onto their purse strings securely. Agents will therefore find limited success in showing their tenants too few or unsuitable properties. 

  

Contact Tanya

 

• About Tanya Sutton

  Country Lettings Director

  Tanya worked with Countrywide for 9 years before joining Chesterton Humberts in 2009.  Tanya has been involved with, and worked on, every step of the residential lettings process over the years and in doing so, has gained valuable experience to ensure that her offices provide first class customer service whilst ensuring that compliance with the latest legislation and regulations are met. As a landlord herself, Tanya is aware of how important both these elements are to her clients.

  This summer will see Tanya make up one of 5 teams Chesterton Humberts has entered into the Wooden Spoon Four Peaks Challenge, in which the challengers climb 4 mountains over a 48 hour period for charity.  Tanya is also a keen squash player and regularly takes part in Pilates to unwind.  Tanya is heavily involved in her son’s school’s PTA, having chaired the group for 2 years she is now serving vice-chair.

Following on from the Chancellor’s budget announcement, Robert Bartlett, CEO of Chesterton Humberts, comments on its implications:  

“As the Chancellor mentioned in his first-ever tweet on the morning of his speech, this budget was aimed at helping people who just ‘want to work hard and get on’. The main announcement affecting the property market was that of ‘Help to Buy’ – a scheme designed to help buyers get on and move up the property ladder by providing equity loans for purchasers of new build homes  and mortgage guarantees to other buyers.

 “Second steppers, and even third, fourth and fifth steppers, are the surprise beneficiaries of this year’s budget as they have now been allowed to enjoy some of the incentives that have previously only been available to first-time buyers. Under the ‘Help to Buy’ scheme, which will not be means tested, all buyers buying under £600,000 and with at least a 5% deposit can access the equity loan scheme when buying a new build property or the mortgage guarantee scheme, which is not restricted to just new homes. 

Overall, I welcome the measures relating to the housing market, which definitely represent good news for aspiring homeowners and the housebuilding sector, but I am still questioning whether  there was enough in the Budget to really build on and sustain the momentum seen so far this year. 

To put it into perspective, the Help to Buy mortgage guarantee scheme has an allocation of up to £12bn and the equity loans scheme is worth £3.5bn, figures which seem slightly less significant when compared against the £80bn Funding for Lending scheme launched last July, although admittedly not all that funding is for housing.  Again, looking at the equity loan scheme, this expects to support up to 74,000 purchases but this equates to just 7.9% of 2012 transactions and a meagre 4.6% of 2007 transactions.”

 Other measures

 Funding for Lending

“I am disappointed that the Chancellor did not take the opportunity to extend the Funding for Lending Scheme, which has injected liquidity into what was previously a lacklustre housing market and has been the trigger for the spate of record low fixed rate mortgage deals which have come onto the market in recent months. However, HM Treasury and the Bank of England are discussing potentially extending the scheme beyond January 2014 and I remain hopeful of a positive outcome.”

 “Mansion Tax”

“I am relieved that the Chancellor has not bowed to pressure from the opposition and his Lib Dem colleagues to introduce a wide ranging ‘mansion tax’. This would have been a blunt instrument which would not redistribute money from the wealthy to the poor as many owners of £1m+ homes do not fall into the “wealthy” category – they have merely seen the value of their homes rise above the threshold over time – in some cases over a long period.”

 Council Tax

“I am similarly pleased that the Chancellor has not heeded calls for the introduction of new punitive high-end council tax bands on an already increasingly tax burdened property sector. However, I would have liked to have seen councils forced to freeze their council tax rates for a further tax year rather than just be given the option to do so as many households continue to struggle with their finances in what is still a difficult economic environment for many.”

 Taxation of High End Properties

“Unsurprisingly, the Chancellor made no changes to the previously announced measures aimed at cracking down on wealthy buyers utilising tax avoidance schemes to acquire and hold high end residential property.”

“As a result of the measures outlined in the 2012 Budget, which encompassed the annual property charge on ownership, capital gains tax on disposal and a higher rate of stamp duty on acquisition, we have noticed that far more buyers that would previously have made use of SPVs are now buying in their own name.”

 Housebuilding

“I applaud the Chancellor’s commitment to housebuilding, demonstrated by his move to expand the Build to Rent fund to £1 billion to support new development and double the affordable homes guarantee programme, providing up to an additional £225 million to support a further 15,000 affordable homes starting in England by 2015. These measures will go some way towards eating into the long standing housing shortage and will additionally provide employment and boost GDP growth.”

 ”However, I would like to have seen a more pro-active approach: setting a realistic timetable for the release of surplus public land with fast track consent to developers and offering it at below market rates – but taking a proportion of the profit as payback.”

“I would also like to see the Government force banks to allocate a proportion of their loan books to residential developers – for a range of property price bands – with a focus on affordable but also to include some higher value properties.”

 Right-to-Buy

“Any moves to assist hard pressed households to buy their own property are to be applauded and so the Chancellor’s announcement that he will extend Right-to-Buy to a larger number of households can be nothing but good news.”

 ”The measures will include simplification of the application process and a reduction in the qualifying period before tenants become eligible for Right to Buy from five years to three years. From 25 March the maximum discount cash cap in London will be raised to £100,000 where the current cap is most keenly felt.”

 



 

Contact Robert

 

• About Robert Barlett

  CEO – Chesterton Global Ltd
  ^{Appointed CEO of Chesterton in September 2006, Robert has spearheaded the dramatic growth in Chesterton and was instrumental in the acquisition and merger of Humberts in December 2008. Robert became Group CEO for Chesterton Global Limited in 2007. He was previously CEO, Residential for Cluttons LLP where he was an equity partner and has a background in investment banking and brokerage within the United States. Robert rowed internationally and represented Great Britain in the 1992 Olympic Games.}