Written By Em

Em

Em Morley

13 Property Buying Superstitions for Friday the 13th

Published On: April 13, 2018 at 9:51 am

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Categories: Property News

There’s no better time than one of the spookiest days of the year – Friday the 13th – to explore some of the superstitions we have traditionally associated with the properties and houses we own.

  1. The number 13

There are many theories as to why the number 13 is associated with mayhem and misfortune. The first could be that in Christianity, the 13th disciple to sit at the Last Supper, Judas, went on to betray Jesus. Also, there are traditionally 13 witches in Pagan/Wicca circles, to the aborted Apollo 13 space mission. There is no shortage of reasons as to why individuals are more reluctant to associate the number 13 with their investments than other numbers.

Friday the 13th

Friday the 13th Superstitions

  1. Leave your previous broom behind

Another superstition dictates you should leave the broom you used in your old house behind. Bringing it with you is thought to transfer some bad luck of your old place to your new one. However, replacing an old broom of course sounds wise anyway for your brand new property!). 

  1. New shoes upon the table

A well-known ‘old wives tale’, putting new shoes upon the table is thought to be a bad omen. This superstition is thought to originate from back when the dead were dressed and prepared for funerals on a table at home.

  1. Broken mirrors 

Breaking a mirror is thought to signify the start of seven years of bad luck. In Roman time, it is said to have signified the soul being trapped in the fragments of glass. Either way, there’s no harm in placing an extra layer of bubble wrap when moving reflective items to your new property!

  1. Fridays are unlucky for a move

 Apparently, Fridays, Saturdays and all rainy days are unlucky for a move, according to Indian superstitions, and could prevent you from truly settling in to your new home. A Thursday is apparently the luckiest day to move into a new property.

  1. Opening an umbrella inside

The action of opening an umbrella indoors could result in angering the sun gods, according to ancient Egyptians. However, in a country like the UK with so much rain anyway, it may not make too much of a difference.

  1. Sage cleansing

The ritual of burning certain herbs has long been commonplace to many cultures across the world. However, performing a sage cleansing ritual is still a good opportunity to focus on dispelling any negative energy, thoughts and toxicity you might want to leave behind. 

  1. Scatter coins 

Scattering coins into the corners of your living room is thought, according to a Philippine tradition, to bring the new homeowner peace and prosperity in future months.

  1. Lucky numbers

Certain individuals and societies attribute significance to numerology. The numbers 6, 8 and 9 are seen as sources of good luck in Chinese culture, whereas the number 4 is considered particularly unlucky.

  1. Exit the door you entered

This one is an old Irish tradition for the first time you enter and exit your new property. Leaving through the same door you entered home is thought to ensure you’ll avoid any lurking bad luck that might have previously been heading your way.

  1. Feng shui 

Perhaps less of a superstition than some others on this list, this ancient Chinese practise looks to harmonise the environment to create a tranquil living space. It’s also still popular today among many interior designers, aiming to ensure the property works its best for the health and happiness of the inhabitants. 

  1. Paint your front porch blue

This particular superstition originates from the American Deep South. It was thought that ghosts weren’t able to cross water, so painting your porch blue will surely dissuade any ghosts nearby from entering your new property.

  1. Don’t walk under a ladder

This familiar superstition is thought to originate from when ladders were, quite morbidly, a symbol of the gallows. To walk under a ladder meant that you were tempting the same fate. However, nowadays, it might just be a practical means to avoid any accidental injuries or items falling!

Whilst the above superstitions may really have little significance in today’s modern world, there is arguably still some measurable difference in properties labelled the number 13.

A 2017 Zoopla survey found properties with the number 13 are on average, £9,000 cheaper than their 12 or 14 neighbours. So, whilst Friday the 13th may be considered unlucky for some, if you’re in the property market for a home and you’re not too superstitious, it could be a very lucky day to obtain a bargain.

Age Limit Scrapped for Experienced Buy to Let Landlords

Published On: April 13, 2018 at 8:55 am

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Categories: Finance News

Age Limit Scrapped for Experienced Buy to Let Landlords

The Mortgage Works (TMW) are scrapping the maximum age restriction for older buyers next week. A branch of Nationwide Building Society, TMW’s change comes after a decision that mortgage cases from older borrowers who have long invested in the Buy to Let sector don’t offer a significantly higher risk than for younger borrowers.

As of the 18th of April, there will be no maximum age at either application or redemption for experienced landlords who are hoping to borrow up to a 65% loan-to-value (LTV) ratio for purchase or remortgage.

Having a lower LTV ratio benefits older buy-to-let landlords, who have the cash up front to be able to put down a higher deposit (such as 35%), meaning the risk to the lender is reduced (as the new homeowner’s equity is higher).

Usually, conventional homebuyers have about an 80 – 90% LTV, which is a factor of increasing the possible risk for lenders. By reducing the LTV to 65%, this means the risk has decreased, even for prospective borrowers now aged 70+.

TMW also recently hiked the maximum LTV for new purchase and remortgage products for first time landlords.

Paul Wootton, Nationwide’s director of specialist lending, said: “TMW is extending its range of mortgage products to include loans at up to 80% LTV to give greater choice and more options for landlords, including those taking out new buy to let mortgages and those looking to refinance existing borrowing.

“TMW is entering an established part of the market to offer a range of competitive rates to landlords working to manage their costs, including for those with smaller amounts of capital invested.”

Age Limit Scrapped for Experienced Buy to Let Landlords

Age Limit Scrapped for Experienced Buy to Let Landlords

Natwest and Barclays to change rates of mortgages for Buy to Let products too

A NatWest Intermediary Solutions spokesman said: “Having reviewed our portfolio we have made some adjustments to rates to reflect the current market conditions and balance our mix of business.”

Some of Natwest’s two-year fixed rate But to Let purchases have seen increases of 3bps, with some of its five-year rate purchases are up by 6 – 11 bps.

Basis points (bps) refers to a unit of measure for describing interest rates. One basis point is 1/100th of 1% (0.01%), and the unit used in the finance industry to measure changes in interest rates, as they can be very slight.

As of this month, Paragon Bank has also launched a range of limited edition buy-to-let mortgage products. John Heron, Managing Director of Mortgages at Paragon has commented: “Our new Limited Edition buy-to-let range brings added choice and flexibility for portfolio landlords looking to refinance or expand.

“The addition of cashback provides an extra boost, helping landlords fund the up-front costs associated with arranging finance and enhancing value for this important segment of the market.”

Back in 2017, the LTV of a typical landlord fell to 35%, meaning the majority of landlords actually own more than half of their investment, meaning that these changes seem to be fitting the market requirements – of lower risk to lenders, and more easily accessible products for older prospective landlords – whilst creating more all-important rental homes.

With many banks adjusting their lending criteria, it could mean good signs for landlords and the rental industry. Especially with older people now increasingly moving into rented accommodation, and younger people struggling to find decent but affordable homes, it seems these financial changes in the rental market are coming at a welcome time.

 

 

 

More than Half of Landlords Planning to Sell their Properties, Study Claims

Published On: April 13, 2018 at 8:03 am

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Categories: Landlord News

More than half of private landlords are planning to sell some of their buy-to-let properties this year, according to a new study by Property Partner.

The crowdfunding platform found that 54% of landlords said that they would reduce the size of their property portfolios as mortgage interest tax relief changes continue to hit.

Restrictions to mortgage interest tax relief for buy-to-let landlords began in April last year. Analysis by Property Partner suggests that many landlords have now had enough and are planning to offload their properties.

The research shows that 64% of landlords have had their finances negatively impacted by the mortgage interest tax relief changes, while 59% have been affected by higher Stamp Duty costs on additional homes. 44% have had their finances impacted by tougher mortgage affordability checks.

The now former chancellor George Osborne’s attempts to create a “level playing field” between landlords and those buying homes to live in may have cooled the buy-to-let sector, but the study goes on to suggest that the changes are having an adverse impact on tenants, as landlords are being left with little choice but to pass their increased costs on.

Almost half (47%) of landlords have already increased or are considering increasing rents for their tenants in the face of new buy-to-let rules.

Mark Weedon, the Head of Research at Property Partner, says: “The Government’s plan is to cool the buy-to-let market in order to increase access to property for potential first time buyers. Unfortunately, it’s clear many landlords are being forced to consider increasing rents to offset their losses, which could actually hinder those looking to take their first step on the housing ladder.

“The UK housing market remains vastly undersupplied. Attempts to tweak demand with a crackdown on investors will not solve the housing crisis; the real solution is to build more houses.”

He adds: “We should also remember a number of people in the UK choose to rent and enjoy the flexibility renting provides. Professionalised landlords are central to supporting this group in the UK.”

Are you thinking of selling some or all of your buy-to-let properties as a result of the changes by the Government? Let us know!

New CGT Proposal Could be a Nightmare for Landlords

Published On: April 12, 2018 at 9:26 am

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Categories: Landlord News

Yesterday, HM Revenue & Customs (HMRC) made a CGT proposal (Capital Gains Tax) to speed up payments for residential property sales, which could create a cash flow and compliance nightmare for landlords, individuals and property investors.

The consultation document on the CGT proposal suggests changing the way CGT is collected on the sale of a residential property, recommending that a payment on account of CGT must be made to HMRC within 30 days of a residential property sale. If the proposal is accepted, the new system will take effect from April 2020.

Nimesh Shah, a Partner at accounting, tax and advisory practice Blick Rothenberg, says: “The Government is obviously keen to collect CGT as soon possible, and the proposed 30-day payment timeframe would be aligned with the current payment system for Stamp Duty Land Tax when a property is acquired.

“However, the concern is that individuals, landlords and investors selling residential properties will need to file multiple returns throughout the year, meaning a further tax compliance burden. In addition, it will be particularly bad in terms of cash flow for sellers, who will have to pay tax sooner.”

He explains: “At the moment, individuals could have between ten and 22 months to pay the tax due, and can use the funds in the interim at their discretion, for example, to reinvest in another property or invest elsewhere. That advantage will be taken away and they will need to pay over the tax to HMRC almost immediately.

New CGT Proposal Could be a Nightmare for Landlords

New CGT Proposal Could be a Nightmare for Landlords

“Individuals will need to prepare a CGT calculation within 30 days of the sale of the property, meaning they will need to have up-to-date records readily available.”

Under the current system, an individual selling a residential property and realising a capital gain would have to report the transaction on their self-assessment tax return for the year of the sale and pay the associated tax by 31st January following the end of the tax year.

Shah comments: “This can mean the Government does not receive the tax for up to 22 months where a property is sold at the start of the tax year. With the proposed changes, the Government will collect CGT from the sales of residential property far quicker.”

A new payment on account return will need to be submitted as part of the process, meaning that the person will have to report the transaction on two separate returns – the new payment on account return and normal self-assessment tax return. Each property disposal will require its own payment on account return, meaning that a person having to file several returns throughout the year where there have been multiple property sales.

Shah also notes: “CGT can also be payable when someone gives away a property (or a share in a property) and a capital gain arises. Even in this case, the CGT will need to be paid to HMRC within 30 days. Therefore, it will be important that the person has sufficient funds to pay the CGT within the 30-day timeframe.”

If someone is selling their main residence and the capital gain is covered wholly by principal private residence (PPR) relief, a payment on account will not need to be made and a return will not need to be submitted.

However, if only part of the capital gain is covered by PPR relief (because the person had not occupied the property as their main residence throughout their ownership), a payment on account and return will need to be made.

Shah continues: “Interestingly, the proposal does not apply to companies, and a company selling a residential property will continue to pay Corporation Tax under the rules for that system, which is normally nine months after the financial year end of the company.

“It is important to note that the proposal applies to both UK and overseas residential properties, but there is an exception where the gain is also taxed in the country where the property is located, which should be the case in the majority.”

He adds: “However, individuals will need to be mindful when selling an overseas residential property that they do not have a reporting requirement to HMRC, which, if missed, could result in penalties and interest charges.”

Although the CGT proposal is not yet in force, we do remind landlords to consider how future tax changes could affect their finances. Always seek professional advice if necessary.

Latest ONS Figures Show a Decline in Construction Output

Published On: April 12, 2018 at 9:05 am

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Categories: Property News

The Office for National Statistics (ONS) has released its February 2018 statistical bulletin for construction output in Great Britain, and the figures are showing a decline.

This decline of construction output within the three-month on three-month series shows an overall fall of 0.8% in February. The cause of this has been determined as the continued decline in repair and maintenance work, which itself has fallen by 2.6% in the same month.

Month-on-month shows a similar trend of contraction, with a decrease of 1.6% in February 2018, which the bulletin reports to have stemmed from a 9.4% decrease in infrastructure new work.

Looking at the month-on-year figures, we can see that compared to February 2017, construction output fell by 3%, resulting in the biggest month-on-year fall since March 2013.

It has been stated in the bulletin that the snow we received towards the end of February could be partly to blame for these results. Having received information about the effects of the snow on the businesses of those questioned in a small survey, ONS believe the extreme weather conditions have taken its toll, but an exact specification of the damage caused to the industry cannot be determined.

However, overall output may be down, but it is promising to also see reports that new build work is increasing.

Latest ONS Statistics Show Declining Construction Output

Latest ONS Statistics Show Declining Construction Output

Neil Knight, Business Development Director of Spicerhaart Part Exchange & Assisted Move, has commented: “While infrastructure work and repair and maintenance are all declining, construction of new private housing is continuing to grow. A quarter of all construction work in February was for private new builds, which marked a 1.5% rise on January, and a 7.6% rise on February 2017.

“For the past year or so, you haven’t been able to turn on the TV or read a newspaper without seeing stories about new housing plans- just last week the Government pledged £200m of funding for housing projects in the West of England. Clearly, this focus on new housing is starting to pay dividends, and while we are nowhere near producing the level of new housing we need to keep up with demand, we are moving in the right direction. I just hope that this trend continues.”

Shaun Church, Director at mortgage broker Private Finance, has also commented on the statistics: “The government has vowed to get Britain building and it looks like these initiatives are starting to bear fruit, with the value of private housing construction increasing by￡232m in February. Private housing and infrastructure were the only areas of construction that experienced growth in an otherwise struggling sector.

“The widening void between supply and demand is one of the greatest factors driving housing unaffordability in the UK.  The construction of more homes will help bring homeownership back to attainable heights for millions of aspiring homeowners.

“The first-time buyer market is already experiencing a resurgence thanks to Help to Buy and changes to Stamp Duty, and with private residential construction on the up, the prospects for buyers are set to flourish further – provided that construction levels continue to grow and momentum is sustained. The growth in the value of infrastructure work is also positive, helping to build communities and maintain services surrounding families and their homes.

“Buyers ready to pursue their property ambitions should act soon. Lenders continue to have a strong appetite for business, and interest rates remain competitive. Rate rises are expected on the horizon, however, and although any increases are likely to be modest, it may be wise to lock into a good mortgage rate sooner rather than later.”

Are Build to Rent Homes the Answer for Older Tenants?

Published On: April 12, 2018 at 8:09 am

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Categories: Tenant News

The number of older people and retirees moving into rented accommodation has soared over the last few years. Between 2013 and 2017, an increase of 13% was recorded, according to the Telegraph. Whether certain groups and demographics of people are choosing to rent or buy, it’s still apparent that the modern rental market needs to keep up with a diverse range of customer needs.

Stephanie Smith, the Operations Director at Atlas Residential, highlights the needs of different demographics when it comes to good quality and affordable homes.

“When we talk about rented accommodation, too often the image that springs to mind is of young, single tenants sharing a flat, living close to work as they try to start climbing the career ladder. However, that stereotype which the UK subscribed to for the past 7+ years as Build to Rent came to fruition is becoming increasingly outdated, meaning that the way we design and deliver rental developments needs to change.

“I am a firm believer that this is a community for everyone, from a new graduate, indeed, to a retiree who has decided they don’t want the hassle of a mortgage or home repairs and prefer a social community setting.

“The latest English Housing Survey, for example, confirmed that more than 1.5 million people aged 65 and above now live in rented accommodation.”

Are Build to Rent Homes the Answer for Older Tenants?

Are Build to Rent Homes the Answer for Older Tenants?

Particularly vulnerable groups of people, such as the elderly, could feel the effects of a lack of supply in rental homes much more than others. In 2017, approximately 254,000 older people rented privately, and that figure has now risen to 414,000. If this data is extrapolated, estimates suggest a third of those aged 60 and above could be renting privately by 2040.

According to the Centre for Ageing Better, by the time people reach their mid 80s, over half of people have difficulty doing at least one activity of daily living unattended. This means that in order to find good quality and long term tenants for their properties, landlords could need to ensure that their rental homes suit the needs of their prospective tenants.

As Smith continues,

“The Centre for Ageing Better reports that private landlords have the highest proportion of poor quality housing of any tenure type, along with higher levels of disrepair. Poor quality accommodation is unsuitable for any resident, but particularly so for potentially vulnerable groups such as older renters. The difference that the build to rent sector can make is therefore significant.

“Tenancy length plays a role here too. Short-term tenancies are hardly likely to encourage older residents to agree home adaptations with their landlords, yet often a few simple adaptations such as handrails or ramps can enable older people to remain independent in their homes for many years.”

By making sure rental properties are adapted for more than just one type of demographic that has historically been associated with rental properties (young tenants that’ll be moving on soon), perhaps the market will become more inclusive, and beneficial for the diverse range of potential renters that live in the UK.