Real Estate

Understanding the difference…

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When searching for the ideal property to buy, aspiring homeowners may be faced with a choice: leasehold vs. freehold. What are the differences?

 

 

Leasehold vs. freehold: the basics

The main difference between leasehold and freehold is that if you buy a leasehold property, you own the property but not the land it stands on. With a freehold property, you own both the building and the land.

In England and Wales, the majority of flats are leasehold, while houses are usually sold as freehold properties.

 

Buying a leasehold property

With leasehold properties, the land the building stands on is owned by a landlord, also known as the freeholder.

You will own the property for the length of a lease agreement with the freeholder. After the lease expires, ownership of the property will revert back to the freeholder.

You’ll pay ground rent to the freeholder, although this usually won’t be very much. The freeholder will also be responsible for maintaining and running the building, so you can expect to pay a service charge to contribute to the cost of this.

 

 

Buying a freehold property

When you buy a freehold property, you’ll own the dwelling and the land it stands on outright.

There will be no time limit on your ownership, so you won’t have to worry about a lease running out.

You’ll be responsible for maintaining the building and any related costs, but this will mean you’ll be free to do whatever you like to the property (subject to planning permission).

 

Leasehold vs. freehold: a summary

Buying a home is an exciting step, but it is very important to understand any impending issues surrounding property ownership.

When it comes to leasehold vs. freehold, the main difference is that as a freeholder you’ll own your property outright from the get go, while as a leaseholder your ownership will be limited to a set length of time.

If you want to know more about buying a home, get in touch with our team today; we are more than happy to help!

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Landlords have been the target of some serious new taxes and regulations. Although these are worrying for some, these measurements are not an end of the rope for most.

For those of you considering investing in properties, keep in mind this:

long-term investments will surely bring you a good profit. New research showed that investing in buy-to-let, but not on an amateur level, will bring the landlord a stable and consistent source of revenue.

More details and a good case analysis in this article on Property Reporter:

How much could an average long term property investment earn you?

If you’re thinking about investing in a buy-to-let here are our property recommendations from the Victor Michael website:

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The Tenant Fees Bill can soon be a reality for tenants in England. The Government also answered upon the HCLG Select Committee report on the draft Tenant Fees Bill.

The main changes the Tenant Fees Bill can be read here. The most important provisions in the document that are to affect tenants (and landlords) are:

  • Maximum security deposits: six weeks’ rent.
  • The upper limit for holding deposits can be of no more than one week’s rent.
  • The landlords can charge more than £50 for sharer charges only after they prove that the costs were greater than the amount mentioned.
  • Landlords will not be able to issue a Section 21 notice until they have repaid any unlawfully charged fees.
  • Letting agent transparency requirements will be included in The Consumer Rights Act 2015. This will also be applied to websites and portals that do lettings.

Moreover, the Trading Standards should help tenants to recover unlawfully charged fees via the First-tier Tribunal.

To sum up, there are only some limited extra-charges a landlord or an agent can charge the tenant with:

  • a change or early termination of a tenancy when requested by the tenant
  • utilities, communication services and Council Tax
  • payments arising from a default by the tenant such as replacing lost key

What is your opinion upon the bill? Does it help enough tenants? Are landlords and agents too restricted?

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Moving house can be a long and tedious process, but the day that you finally wake up and realise you’re moving into a new property can be incredibly exciting. A new house comes with new adventures, new possibilities and a new place to put down roots, but depending on your situation it can be weeks or months after buying a property before you finally get to move in.

 

Moving day can be quite complicated, and there is a lot to get done. Delays can only add to any potential stress, so it is important to make sure your move goes as smoothly as possible. Here are some tips to avoid any moving house delays:

 

Communication

 

You will speak to many different people while moving house, including estate agents, solicitors. surveyors, removal companies, and more. Filling out any paperwork quickly and replying to any enquiries can really speed up the process of moving.

 

Make sure you have copies of your ID, bank statements and any planning permission needed throughout the process, so you can be ready to hand anything over when needed. Keeping everyone updated throughout your move means any problems or concerns should be quickly fixed and the whole move should go smoothly.

 

Book in Advance

 

Ideally you should start arranging a removals van around four weeks before your moving day. Contact three or four companies and get a consultation with each. They will all provide you with quotes and you can decide which one works best for you.

 

Once you have that booked you can make any other arrangements you need, such as parking. If you are moving to a house that only has road-side parking, you will have to give notice to anyone it may affect, and let them know a removals van will be parking up for a few hours.

 

Avoid Exchanging and Completing on the Same Day

 

Although it may seem like an obvious option and a good thing to do, exchanging and completing on the same day can actually cause problems if you are part of a chain – it only takes one person to be unable to complete for the whole chain to break.

 

Try and leave a week or two between exchanging and completing, as this should give you enough time to resolve any potential complications that could come up. It’s good to have a bit of breathing space when moving house, as you never know what might happen.

 

Packing Preparation

 

One of the key things that will prevent delays on moving day is to have everything packed up and organised. The last thing you want is to be rushing around packing up some last minute items when you have a hundred other things to think about.

 

Start a month or so before you move, and keep everything as orderly as possible. Chuck out any clutter or take it to a charity shop, and pack a few boxes each night, carefully labelling them and wrapping anything delicate in bubble wrap. Having everything packed and ready to go will be a huge time saver when you get round to moving.

 

Arrange Child/Pet Care

 

Even though they are moving with you, children and pets can be quite distracting on moving day, and it can be quite an unsafe environment for them to be in with heavy boxes being carried back and forth to your new home.

Try and arrange for someone to look after them while you move, as this will allow you to concentrate fully on the task at hand and allow them to move into a new house afterwards with all their belongings in place. If you have older children you can find age appropriate tasks to enable them to help out with the move.

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Animal lovers change habits on the lettings market. Since this is a growing characteristic of tenants that choose long-term solutions, landlords are starting to be more flexible.

Latest study suggest that ‘Lets with Pets are the Homes of the Future’, how Property Reporter puts it.

And it’s easy to see why people are more considerate and loving towards animals. Any animal lover/ owner knows the first-hand benefit of pets: lowering the stress level. Dogs, cats, or fish – name your animal friend, have the power to make us feel more relaxed after work. Knowing we’ll find them at home when we arrive, practically makes the home more welcoming.

If your landlord doesn’t want to be as flexible as the new-age landlords you have two solutions:

  1. Choose one that allows pets.
  2. Try to make him change his mind.

You can start with the argument above, and find more inspiration to be persuasive in the following article:

How to Convince Your Landlord to Allow Pets

Are you an animal owner? How did you convince your landlords to rent their houses?

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Renting will cut your monthly income by a almost a quarter. Taking that into consideration, it is only natural to choose wisely when it comes to places to rent. However, a recent study found that there are some common interests between London renters.

Major concerns and interests for renters:

-> saving money: discounts and offers that help saving money daily.

-> the rising cost of living.

-> saving money on transport costs.

Despite all the eagerness to save money, 74% of renters questioned would pay a higher rent if this means saving money on daily necessities (groceries, household bills, and transport).

For more insights, read the entire article on Property Reporter.

Where do you find yourself? A big spender or a cautious cost planner?

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Awards for the Victor Michael team at the 2018 ESTAS

Last night was a very important night for Victor Michael. The team at Victor Michael was awarded two gold awards at the Estate Agent of the Year Awards (ESTAS) 2018.

The two gold prizes received by Victor Michael were for:

  • Best Estate Agents Group in London
  • Best Agent in London East

The ESTAS awards 2018 happened under the tagline “Because Service Matters” and it highlighted regional and nationally services like real estate agents, brokers, conveyancers, home-builders for the excellent standard of customer service they deliver throughout the year.

You can watch the moment of the announcement of the Gold Winner on our Facebook page.

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What is remortgaging?

Remortgaging is the act of moving your loan from one lender to another or negotiating a new rate with your existing lender. You might be able to find a cheaper deal elsewhere, letting you save a bit more each month and pay it off faster. Or you could extend the length of your mortgage, allowing you to pay less each month (but taking longer to pay off completely and paying more interest over the length of your mortgage).

So if you’re looking to pay off other debts*, shorten the length of your mortgage or simply reduce how much you’re paying, you may want to consider remortgaging your home.

The process of remortgaging is fairly simple, but figuring out whether it’s the right financial decision isn’t. We do recommend speaking to a financial adviser further before making a final decision.

Why you may consider remortgaging:

  • The value of your property has increased (significantly) since you took out your mortgage, putting you in a lower ‘loan-to-value’ band that opens you up to lower rates.
  • Your existing lender won’t allow you to pay more towards your mortgage, even when you can afford it.
  • Your existing deal is coming to an end and your lender will place you on an SVR (standard variable rate).
  • The Bank of England rate is going to increase, as this can affect your mortgage.

Why you may consider staying with your current lender:

  • You’ve suffered credit issues or failed to pay debts (since starting your mortgage).
  • If an early repayment charge payable on an existing product exceeds the cost of any savings that could be made by remortgaging.
  • You’ve only got a small amount left to pay; switching lenders so late on in the process means you may not save that much.
  • Your work situation has changed; perhaps you’re now self-employed or no longer working. This could affect a lender’s decision either way.

What to do when deciding to remortgage

Do your research

Comparison sites are handy for finding current deals, but they don’t always explain in certain terms what’s right for you and your particular circumstances. If you are unsure, we suggest consulting with a mortgage adviser who can make the process as easy as possible and find the right rate for you.

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

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Saving up to buy your first home is a challenge that can at times, feel impossible. If you’re a future first time buyer looking for tips on saving for your first home, read some of our advice below:

Correct preparation

It’s important to think about what you need to do before you even start looking at properties, such as saving for a deposit. The general rule of thumb is to save at least 5-20% of the value of the property you want to buy.

So if you’re looking to purchase a home that costs £200,000, you’ll need to save at least £10,000 (5%). But saving more than that will grant you access to a larger range of more affordable mortgages.

But keep in mind that deposits and monthly mortgage payments won’t be your only outgoings, you’ll also need to invest in surveys, removal costs, building insurance, stamp duties, and solicitor fees.

It might go without saying, considering what we outlined above, but saving a little extra per month goes a long way in speeding up the process. Perhaps give up a gym membership and exercise at home, or skip your daily coffee; it’s not easy, but in the end it will certainly be worth it.

Taking care of your money also helps you build a better credit rating, which will open you up to a wider range of mortgages later down the line.

Explore your options

The government has several schemes that assist first time buyers onto the property ladder, including:

Shared Ownership – this is where you purchase a share of your property from the landlord (usually a housing association or the council) and rent the remaining share.

Help to Buy – this is where the government makes a 25% contribution to what you have saved. If you save money into a Help to Buy: ISA, for every £200 you save, you will receive a government bonus of £50. However keep in mind that this scheme is only applicable for New Build properties.

Rent to Buy – this is a government scheme which aims to ease the transition from renting to buying, providing subsidized rent for a certain number of years in rent to buy homes. After the time has passed, you have the option to buy the property, or enter a part rent/part buy shared ownership scheme.

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You have probably heard that first impressions are vital but did you know that within 15 seconds a buyer has already developed an opinion of your property? This is why creating the right first impression is critical to achieving a successful sale.

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FROM YOUR DRIVEWAY…

Ensure the front garden looks its best – mowed lawns, weed-free flowerbeds and an uncluttered access to the front door. Make sure your house number or name is clearly visible from the road. Leave plenty of room for potential buyers to park.

A WARM WELCOME…

Be ready, turn the heating on and light fires in winter. Open curtains and turn on lights because people react favorably to brighter properties. Appeal to the senses with fragrant flowers, there are many ways to create an exciting interior with surprisingly little money.

FAMILY PETS…

Its preferable for your pets to remain outside during viewing. Where possible make sure your carpets and furniture are hair free.

THE CHEF’S PRIDE OF PLACE

Your kitchen can have a major impact on the sale of your house. It should be well organised with tidy cupboards and worktops. Make sure its is virtually spotless and smells fresh. And keep your tea towels in the drawer not over the hob.

SPACIOUS BATHROOMS

It’s imperative this room looks bright, clean and tidy. Dripping taps, discolored carpet, dirty tiles or evidence of a leaking shower unit should be addressed. Make sure the toilet seats stays down.

TIDY BEDROOMS

Clean and tidy bed linen gives the impression you care about the presentation of yourself and the property you live in. Remove any evidence of washing or ironing to allow your room to look larger and more spacious. Clear the toys and make the beds.

D.I.Y.

Don’t allow your property to let you down, ensure any loose tiles, missing handles or broken windows are mended or replaced. If you are unable to do the task simply ask us to recommend an expert. Bad D.I.Y stands out more than you think to a buyer.

PRESENTATION

The positioning of furniture in each room can give the impression of either clutter or space. If necessary, remove some furniture from your main rooms. living, dining, and master bedrooms to allow ease of viewing. Touching up paint and re-sealing wallpaper can improve the quality of presentation. First impressions are vital.

YOUR BUYER LOOKS INTERESTED?

Buying a new home is a big decision and expense. By understanding the buyer’s need to visualize themselves living in your home you can dramatically increase its sale-ability.

Let buyers look around at their own leisure.

Have all essential guarantees on hand and be prepared to answer any questions that arise.

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