July, 2020 12th
While some of us love the hustle and bustle of a town or city, some of us crave peace and quiet.
If you’re in the latter group, finding a quiet road or neighbourhood is probably a priority, so here’s what you can do to make your search successful.
Research your location thoroughly
Your location has a huge effect on the noise levels around your home. You could be in a village but if one wall faces a noisy road or picks up the sound from a train line, your peace could be shattered. Look for existing roads, bus and lorry routes and train lines, as well as any that are set to be built in the next few years.
Look at the physical features around the property you’re viewing
Speed bumps are great for slowing down traffic in your road, but they do make a lot of noise. You also need to see if there are any restrictions on HGVs in your street, as well as pubs and even nightclubs nearby. If you’re rural, you’re unlikely to be anywhere near a nightclub, but your quaint village pub might get a bit rowdy every Friday night.
Visit the location at different times of day
If your seemingly quiet road has lots of early morning deliveries, or there’s a noisy school kicking out at 3.00pm on weekdays, you might not appreciate this.
Spend some time on the top floors
Whether it’s a flat or a two or three-storey house, being elevated a bit might filter out a lot of street noise. If your bedrooms are at the back of the property you could also be shielded from street sounds.
Ask your surveyor if there’s anything you can do about noise insulation
There may already have been some modifications made, or you may be able to make them if necessary. If you’re buying a period building, you may be restricted with the sort of noise insulation you can install.
Look at the neighbours
If there have been any disputes with the neighbours in recent years, your vendor will have to declare it. Of course, it may be something that was resolved amicably, but then again, it could be a complaint about all-night parties four nights a week.
Do you need carpeting?
If you’re buying an apartment, the lease might require you to have carpeting rather than wooden floors. You might be able to have a wooden or tiled floor if you install soundproofing underneath, though.
Have a budget for modifications
You might have found the ideal property only to discover that you can hear the nearby dual carriageway when the leaves have fallen from the trees in between you and the road. What you might need is some double or triple glazing, or maybe some evergreen trees at the bottom of your garden, to dampen the noise. For a reasonable outlay, you could have all-year-round tranquillity.
Watch for hidden surprises
You never know what’s a few years down the line. If there’s a disused factory or a brownfield site, it could be the site of a new housing complex within a decade. Be ready to make further modifications to your property or even to move.
July, 2020 9th
First-time buyers could be in clover this year after several banks reintroduce high loan-to-value (LTV) mortgages.
When the covid-19 lockdown was first announced, many lenders stopped offering mortgages to anyone looking to borrow more than 75% of the value of the property. Just recently, however, lenders have reintroduced these high LTV deals for borrowers with smaller deposits.
New Nationwide customers can apply to borrow up to 95% of the property’s value and Clydesdale/Yorkshire Bank has reintroduced first-time buyer mortgages for up to 90%.
The financial website Moneyfacts.co.uk says that the number of two-year fixed mortgages for people with a 10% deposit rose from 24 products in May to 55 in June. Anyone with a 15% deposit can choose from 116 products in June, rather than just 87 in May.
For people with a smaller deposit – 5% or so – there are only a few options, however, with just six two-year fixed home loans available and nine five-year fixed rate mortgages.
House-hunters are out of lockdown
In terms of looking for a new home, anyway. As people get back to work, they’re resuming their hunt for a new property and the market should react with offering more options for borrowers with smaller deposits.
Mortgage lenders reduce their rates
Some lenders have also lowered their fixed interest rates recently, which will make buying that first home even easier. Nationwide reduced its two-year fixed rates for LTVs of up to 90% by 0.15%, for example. The average rate for a two-year fixed deal, in June, for a first-timer with a 5% deposit is 3.28%. A 10% deposit gets a lower interest rate of 2.30%
Buyers can expect some delays with valuations
Lenders will have a massive backlog of valuations to get through as lockdown lifts. At the height of lockdown, valuations were put on hold. Some valuations, for lower LTV mortgages, were eligible for automated processes, but higher LTVs – 95% or so – needed to have a surveyor visit the property in person. HSBC is offering automated valuations for buyers and remortgaging customers with an LTV of 90%.
This backlog might take a few weeks to work down, especially if some surveyors were furloughed by their employers.
July, 2020 6th
If you’ve just found a great rental, it’s easy to get carried away, start buying new rugs and sign on the dotted line without having a good look at your tenancy contract first.
There are five main things you should examine and think about before signing your contract.
The terminology used in the contract
Do you know the difference between an assured shorthold tenancy (AST) and an assured tenancy? Is it fixed-term or periodic? Is the tenancy agreement, or any part of it, verbal? Is there any phrase or term in the contract that you don’t understand or that you’re confused about?
If there is, then you can always talk to your letting agent, or Shelter, the housing charity, for more advice and explanations.
Read through your contract once again
We’re all familiar with the phrase “read the small print”, but if you’re aware that sometimes you tend to skim over it rather than, you know, read it, you should curb that tendency for once.
A tenancy agreement is an important contract, so it’s important to understand everything in it; after all, it’s about the roof over your head. As with the terminology used, you should query any clause that you don’t recognise.
Look at what’s included
You need to check that certain details and pieces of information are included in the contract. Look for:
- Your name and the names of your fellow tenants, the landlord’s name and address, as well as the address of any letting agent involved;
- How much the rent is, how and when it needs to be paid and the dates or frequency of rent reviews;
- How much deposit you’ve paid and how it’s protected – landlords must put your deposit in a government-backed deposit scheme;
- The circumstances in which your deposit will be withheld, such as property damage;
- The bills you’ll be responsible for, if there are any bills that aren’t included in the rent;
- The start and end date of the tenancy, as well as the requirements for ending the tenancy, and
- Your obligations and those of the landlord.
You should also look for anything within the tenancy agreement which could ‘indirectly discriminate’ against you, such as the landlord refusing to change a no-pet policy when you need a guide dog.
Once you’ve signed the contract, you need to get a copy of the contract for your own records.
Look for any extra details and clauses
The contract might also include information on lodgers, guests, repairs, fittings, smoking and pets, as well as landing over the tenancy to someone else.
Do you need to change anything?
For anything to be changed, both you and your landlord need to agree to the amendments. These changes need to be in writing, too, whether as part of an entirely new document or as changes to the original agreement.
July, 2020 3rd
Lots of house-hunters wonder what the difference is between ‘sold, subject to contract’ and ‘under offer’.
They’re both terms that you’ll see in estate agents’ windows and on websites and because they’re different, you might think they mean something different. They actually mean the same thing; it just depends on which phrase your estate agent prefers to use. A property could be described as being under offer if a potential buyer has put an offer in but had it rejected, but agents are unlikely to do so as it could put off others.
Under offer usually means an offer’s been accepted
Estate agents tend to use the phrase ‘under offer’ when the vendor has accepted an offer on their property, whether it’s at their asking price or not.
It’s not unusual, however, to see ‘STC’ or ‘SSTC’ used, which means either ‘subject to contract’ or ‘sold, subject to contract’. This means that an offer’s been accepted, but the contracts haven’t been exchanged yet.
The STC or under offer period is a bit of a grey area because it’s the time during which surveys are done on the property, mortgages are sorted out and other ducks are lined up. It’s also the time during which mortgages fall through, minds are changed and structural problems are found, so contracts might end up not being exchanged after all.
Can you make an offer when there’s already an existing offer?
In a word, yes. Well, usually. ‘Under offer’ is slightly more open to other suggestions. Some buyers ask for estate agents to add ‘STC’ to a listing once their offer is accepted so that “rivals” are discouraged. Many agents will also stop viewings on an under offer or STC property, but it’s not necessarily off the market and it’s not illegal to make an offer, with or without a viewing.
Gazumping is when a new buyer comes along with a better offer than the existing one and the vendor accepts it. It used to be a bit of a plague, but it’s not as common now and many estate agents have policies to help to prevent it. When you see a property that’s under offer or STC, however, it’s essentially still on the market until contracts have been exchanged.
It’s not “fair”, but it can happen to the best of us, so if you’re thinking about gazumping, find out whether the buyers have asked for the property to be taken off the market and whether the vendors are open to other offers. If you make an offer, the agent is legally obliged to pass it on to the vendor and from then on, it’s up to them. Some vendors won’t want to let down the people whose offer they’ve already accepted, while some will be happy to accept a higher offer.
Reducing your risk of being gazumped
If you’ve made an offer on a property, you can reduce the risk of being gazumped by asking the vendor to take the property off the market, as well as by forging a good relationship with them. Making rapid progress with the sale is also really helpful, as vendors can get nervous and may be more likely to accept a higher or more “proceedable” offer if it’s all taking a while.
May, 2020 29th
Condensation is unsightly at the best of times and, if it’s a permanent feature of your home or rental property, it can become a health hazard. Here’s a few ideas to help you to prevent or minimise this damp nuisance.
Make sure you’re always ventilated
Even in winter, you should open at least one window for a few minutes, especially if you’re in an older property. If you really have a problem, then a dehumidifier might be an option for the colder months. You can also check to see if your chimneys are blocked off, as this can prevent air from circulating effectively.
Stay alert for the signs
It’s not just misted-up bathroom mirror or a damp kitchen splashback you need to watch out for, it’s things like permanently damp walls, bubbling paint or wallpaper or even mould. This is when you could start to feel the impact of the damp on your health, so if you see signs like this, you need to take action.
Dry your clothes on an outdoor washing line
Of course, sometimes this isn’t possible, but do it as much as you can. Even in the winter, clothes can still dry if the air is relatively dry and if there’s a few rays of sunshine. If you do have to dry clothes indoors, do it as close to an open (even if just slightly) window as possible.
Use or install an extractor fan
If you have one, use it. If you don’t, install one. Cooking releases a lot of steam and if you can send it packing to the great outdoors before it gets a chance to escape from your kitchen, you’re on the right track. You should leave the fan running for 10-15 minutes after you’ve finished cooking, too. Another handy tip is to cover your pots and pans as much as possible to trap most of the steam.
Make sure your washing machine and tumble dryer are properly vented
Anything you can do to prevent water vapour escaping into your living space is a bonus. You’d be surprised by how much a hot wash can generate, especially when you open the washing machine door.
Leave gaps between furniture and walls
This is a really good and often overlooked trick. Most people want as much room as possible in the centre of their rooms, but by having large furniture items right up against the walls, you’re preventing the free circulation of air. Condensation can build up, unseen, behind sofas and other large items, leading to mould.
Open the bathroom window after a bath or shower
In the summer, if privacy permits, you can leave the window open while you perform your ablutions, too. If you don’t have a bathroom window, then use or install an extractor fan.
May, 2020 26th
In recent years there’s been an increasing number of ten-year mortgages available to buyers and homeowners looking for new home loans. Most terms are for two, four or five years, so what’s the appeal of such a long agreement and is one right for you?
As your mortgage will probably be the biggest investment you ever make, and although you can always switch to another product or provider if you’re unhappy, life is much easier if you get it right from the beginning. Deciding on the length of term that’s going to work best for you is a big part of this, so if you’re thinking about a ten-year term, you need to look at the pros and cons.
The advantages of a ten-year mortgage
A longer mortgage deal like a ten-year fix gives you as much certainty on your mortgage payments as you’re ever likely to get. You’ll know how much your payments will be, which makes it easier to budget over the coming decade. This is especially useful if you have younger children or other caring responsibilities.
You’ll be shielded from interest rate rises for the duration of the term. At the moment, lots of lenders are passing on the historically low Bank of England base rate to customers. This, combined with what could be some unsettled few years coming up, could make fixing for ten years well worth it.
The disadvantages of a ten-year mortgage
You’re also shielded from further cuts to the base rate, which could see you paying a bit more each month than you would be if you’d only fixed for two years and were more agile.
The interest rate you’ll get on a longer deal is also more likely to be higher than the one you’d get on a two or four-year product.
You might also find that the lowest interest rates are only available if you have a big deposit or low loan-to-value ratio.
Fixing for longer can mean higher fees, although realistically, if you were going to switch to a new product or provider every to or three years anyway, then this might not make much of a difference.
If you decide to terminate the deal early, you could be faced with some hefty penalty payments, especially if you make the change in the first five or six years of the term. This can also apply if you sell up or need to remortgage.
Seek advice before committing
As with any big financial decision, it’s a good idea to talk over your options with a broker or with your lender first, so that you understand your options and their implications before signing that dotted line.
May, 2020 23rd
In March, the Chancellor, Rishi Sunak, announced that the government was bringing in a three-month mortgage holiday scheme to help homeowners in financial difficulty due to the covid-19 pandemic.
The scheme, which may be extended beyond three months, will help to relieve the financial stress on households whose income has been affected as a direct result of the viral outbreak, as well as to give them time to get back on their feet.
Is the holiday automatic?
No, you’ll have to apply for a holiday. Not everyone with a mortgage will be affected by the pandemic, so they won’t need this help. The government is strongly encouraging lenders to offer applicants payment breaks, so if you apply it’s likely you’ll be successful.
Who’s eligible for the mortgage holidays?
People who are up to date and are facing genuine financial impacts due to coronavirus are eligible. Anyone in arrears that predate March 2020 may not be able to apply, but if their ability to catch up with payments is affected, then they may be able to ask their mortgage lender for other types of help and relief. Lenders will try to offer the most appropriate form of help for each customer facing difficulties.
What about buy-to-let mortgages?
Buy-to-let mortgages are also included in the holiday scheme, as well as live-in landlords with mortgages.
Applying for the covid-19 mortgage holiday
You should contact your lender as soon as possible to discuss your options. Many lenders with an online presence or with banking apps have added an application function to their sites, which can make things easier. Of course, if you’re not sure a holiday is right for you, or if you think you could make partial payments, then you should discuss your options.
Under normal circumstances, lenders would look at a customer’s finances in depth before making a decision, but the rules have been relaxed somewhat in order to offer a streamlined, rapid process for most people.
The payment break in practice
Successful applicants will have their contractual monthly payment reduced to zero (or the figure you’ve agreed with your lender) for one, two or three months. Interest will still be generated on the balance, however, which means that once payments resume, they’ll be slightly higher than they were before. While the holiday scheme may be extended beyond three months, it’s important to recognise that it’s not suitable for borrowers who may face a more permanent reduction in income.
Will the holiday affect credit scores?
Mortgage lenders will make all the necessary efforts to make sure that borrowers who take a holiday due to covid-19 don’t get negative entries on their credit files as a result. However, if you fall into arrears due to the pandemic and only then ask for a holiday or any other forms of help, these arrears may well be reported to the credit agencies.
May, 2020 20th
Whether you have an extensive property portfolio or whether you simply let out one small house that you inherited, you’ll always be looking for ways to increase the value of your rental property so you can increase your rental returns.
Of course, you can sit tight and take advantage of natural upswings in values and yields, but there are improvements that you can make any time that will be well worth the effort. Making the right improvements can bring some great returns, so here are a few of the best fixes for increasing your rental value.
Installing new stone countertops
While it’s tempting to save money and use countertops made from plastic-covered MDF, the trouble is that they don’t last for long and can start to look tatty quite soon. Using a material like granite or marble, while it costs more initially, means your counters and worktops will last for years and stand up to whatever your tenants might throw at them.
Change your floors
Changing some or all of the floors in your rental property is another good idea. Carpets need expensive deep-cleaning treatments in between tenancies and they can also date rapidly. In addition to this, if one area of the carpet is damaged, the whole thing needs to be ripped out and replaced.
Tiles or wooden flooring, on the other hand, are much easier to keep clean. It’s also easier to repair or replace smaller areas if one or two tiles or planks are damaged. Using plain or neutral tiles or wood also means you’re adding less personalisation to the property, which makes it easier to let.
Install a tankless water system
Many older properties still have hot water tanks and immersion heaters. Upgrading to a boiler and unlimited hot water is a smart move, especially if you’re renting to a young family or to a group of sharers.
Take care of the roof
This investment isn’t as visible or exciting as a new granite worktop, but it’s essential. You should replace your roof every 15 to 20 years to make sure it’s safe and doing its job of protecting everything underneath it. Showing that you care about your tenants and their belongings will also help you to let out your property, as well as improving the rental and – if your long-term plans involve selling – asking price.
May, 2020 4th
Legionella pneumophilia is a bacterium that thrives in standing, dirty water with a consistent temperature of between 20C and 45C. If the bacteria are inhaled, due to water vapour emanating from the water source, then the person can develop legionnaire’s disease, which is a dangerous type of pneumonia. If someone is elderly or immunocompromised, legionnaire’s disease can be fatal.
It’s rare, but you still have a duty to prevent it
Last year there were just 500 cases of legionnaire’s disease in England and Wales, out of a population of 59 million. Around half of these cases were among people who caught it while abroad and the other half occurred in community settings like aged care homes.
This means that the chances of your tenants contracting legionnaire’s disease are very small indeed, but you still have a legal obligation according to the Health and Safety Executive. You need to make sure that your water system doesn’t prevent a threat to your tenants and if there are concerns, you must deal with them.
You can either assess your water system yourself or have an independent assessment done to make sure the Legionella pneumophilia bacteria are absent and that there’s not much risk of it appearing and multiplying in your property.
How to minimise the risk in your rental property
If your property is occupied there’s little chance of the bacteria multiplying to meaningful numbers in standing water because the water is used regularly. If you have an electric shower or a combination boiler this risk is even lower because you’re not storing water anywhere.
You can also
– flush out the water system between tenancies;
– flush toilets once a week during void periods;
– prevent debris and dirt entering the system by making sure that cold water tanks have close-fitting lids, for example;
– if you have a hot water cylinder, set the temperature to at least 50C, and
– take out any redundant pipework.
Your tenants can also clean and disinfect showerheads regularly, keep the temperature on the water heater tank (if there is one) high enough to kill any bugs and let you know if there’s any problems with the water system.
May, 2020 1st
If you’re moving in with your significant other and you both own a property, then you might be wondering whether to sell or rent out the “spare” one.
You could sell…
If your property is your first purchase, then it could easily go to another first-timer. There are lots of new house hunters looking for a home, so you could find a buyer pretty quickly.
Selling releases any equity you have in the property and so you can either save it or invest it in your new place. Of course, you might want to keep it aside in case you decide to buy a bigger place with your partner. The good news is that as you’ve just sold your primary residence, you won’t pay any Capital Gains Tax on any increase in value.
You could let it out…
Renting out your property provides a source of fairly reliable income for the future, as well as, if you decide to sell, that lump sum of equity down the line.
The security of still owning the property might also be important to you. Relationships can break up and so it’s good to have somewhere to move back to. If you need to move back into the property for personal reasons, these are grounds for giving your tenant notice.
There are things you need to remember if you’re letting out the property.
You’ll need a buy-to-let mortgage
Simply contact your lender and tell them that you’re renting out the place and they can arrange to change the mortgage from a residential one to a BTL product. This is important, as using a residential mortgage on a rental is actually fraud.
You’ll need landlord insurance
Insurers see rental properties as higher risk than residential, so your old home and buildings – and possibly contents – insurance will need to change to reflect this. Your current provider can help you.
You need to make sure the place is safe
Your property must have an annual gas safety check and get the certificate.
The same goes for the electrics, and also fire safety requirements.
There are also the 29 named hazards listed in the Housing Health and Safety Rating System (HHSRS) – your property will need to be free of them.
You also need to make sure you’ve checked your potential tenant’s Right to Rent status and place their deposit in a government scheme.