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HOUSE AND HOME S UM M ER ED I T I O N 2013 PR ICE: £1. 50
ALSO IN THIS ISSUE: The Right Bait For The Right Catch p.22
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How to Split a House into Flats p.28
Subterranean Extensions p.19
Here at Mark & Co we are dedicated to providing the highest standard in legal service. We are always looking to go the extra mile for you and as a firm we firmly believe that communication and transparency are the key to a successful and speedy transaction. We aim to take all of the pressure off you and deal with all aspects of the transaction fast & efficiently whilst keeping you fully informed. Contact us at any time for further details.
Putting the pieces together
Residential Property Commercial Property Remortgages Transfer of Equity Loan Agreements Probate Litigation
452 Green Lanes Palmers Green London N13 5XD
t. 020 8920 9999 f. 020 8447 9078 m. 07843 476 594
Contact: Vijay Chandras vchandras@markandcolawyers.co.uk www.markandcolawyers.co.uk
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FIND OUT HOW TO MAKE THE MOST OUT OF YOUR HOUSE IN THIS ISSUE Editor/Publisher: CB Patel Consulting Editor: Suresh Vagjiani Editorial Board Asian House and Home: Kish Bhudia, Mitesh Vekaria, Vijay Chandras, Anna Patel, Satish Patel, Pank Parekh, Mayur Vashee, Jayesh Patel Identity Concept and Design: Mo Luthra Branding Consultants www.moluthra.com
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CONTENTS
Housing market to pick up in 2013 P.7 Windows and doors a great return on investment P.9 The power of leverage P.10 Minimise your cost on a divorce battle P.11 A perspective from a property mogul P.12-13 To move or not to move P.14-15 At home with Kish P.16-17 Subterranean extensions P.19 UK house prices buoyant with strongest growth in three years P.20-21 The right bait for the right catch P.22 Up. Down. In. Out...Don’t sell it all about P.24 Beware property extensions can be tricky P.26 How to split a house in flats P.28 An Indians perspective of the help to buy government scheme P.30
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BARBECUE IN STYLE IN 2013 With a generous cooking area of 50cm by 50cm, 3 stainless steel burners with flavouiser bars, a warming rack, and a stainless steel hood with integral heat indicator, this stylish barbecue has the capacity to feed the whole family. And with so many handy features, it couldn’t be easier. The little extras like a utensil tray, split base shelf, and easy start ignition make all the difference to the chef’s barbecue experience. www.outbackdirect.co.uk £439
As we know, men can sometimes be a nightmare to buy for but the BBQ Sword makes the ideal gift! It’s fun and silly but also amazingly useful too. Perfect! This BBQ Sword in the style of a musketeer sword is the ultimate boy-toy and even features a pop out Zorro style mask on the back! Endless fun for any wannabe action hero! From: www.luckies.co.uk £16.95
This is the barbecue starter that ignites charcoal in 60 seconds without requiring the use of lighter fluid, allowing you to start grilling in five minutes. Similar to the heat-focusing technology used in paint-stripping hot-air guns, the charcoal starter emits hot air at 1,290 F, providing a constant, precise flow of heat from the tip of the unit. From: www.hammacher.com £63
The Original Grillslinger does just that. It’s a cleverly designed twist on the classic builder’s belt. A barbecue tool system, it includes three precision grilling implements: tongs, flipper and grill knife, securely held by washable ‘lock-and-load’ inserts. From: www.grillslinger.com £44
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COMMENTS FROM THE EDITORS flat to a very large mansion. Often when they purchased their first home, they would rent all the rooms in their house apart from one, to pay off the mortgage. In those days the mentality was debt is bad. It needs to be paid off. Many Asians have benefitted in adding value to their existing property, extensions, conversions, renovations are not strange activities to the Asian property owner. Land is the only ‘commodity’ which does not grow. High rise buildings are one consequence, going underground is not very surprising nowadays. CB Patel - publisher/editor
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sians and properties go together. Some would remember the hardships even looking for a small room to rent, when the pioneers arrived in this country. Over the years almost 80% of the Asians own their own residence, from a very small
Dear Readers, Welcome to our third edition of the Asian House and Home magazine. This edition has the special theme of enhancing your property, and also features our interview with Mr James Caan. In this current environment, where funding is in short supply, it’s important to be able to maximize your property in every possible way, whether it’s a residential or an investment. This edition has been brought out with the aim of helping our readers in this regard. In this edition I would also like to welcome our two new writers, a designer who has worked closely with ourselves and with James Caan, Mrs Shuli Davies; and a builder whom also as completed some projects with us, Furniturewell Ltd.
This special issue is very well timed for the probable growth in the sector. Enhancing the value of one’s own property is very much the focus. The readers would benefit from the various tips and suggestions as well as cautions and warnings to their advantage. One should always keep a look
The funding for the generous government scheme will not last forever and the lump sum allocated for this by the government will eventually run out. The government is cutting back on education and health, pensions and many other things. This is an unusual and refreshing offering which should be understood and utilized quickly and decisively otherwise you will miss the boat.
We have also featured a much talked about and currently hot topic regarding the Editor/Publisher: CB Patel Managing Editor: Kokila Patel Associate Editor: Rupanjana Dutta Consulting Editor: Jyotsna Shah News Editor: Kamal Rao Chief Operations Officer: L George Chief Financial Officer: Surendra Patel
Accounts Executive: Akshay Desai Business Manager: Alka Shah Advertising Manager: Kishor Parmar Business Development Manager: Rovin George, Nihir Shah & Urja Patel Customer Service: Ragini Nayak Graphic Designer: Harish Dahya & Ajay Kumar
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If the knowledge provided in the humble efforts is used intelligently and proactively, then the efforts of the contributors and ABPL team are well worth their while. I believe they have worked very hard and they deserve our appreciation.
GET INVOLVED
In our next edition we will be featuring property problems, so if you have had any issues with builders or in another area of property we would like to hear from you. If your situation is chosen as a feature, you will receive the advice of our full editorial board free of charge. This is expert help from heads of various property sectors which would normally cost you thousands in professional fees, which you will be benefitting from in exchange for sharing your story for the benefit of the readers.
government incentives towards helping first time buyers raise money for their deposit. This is an important and current topic, understanding the new incentives can allow you to own your home with practically no money down; a rarity in the current environment. In my opinion there will only be a limited time for this window to be open.
Often the only positive stories you hear are ones which have already occurred, once the wave has risen. Here we are alerting you of what is going on in the horizon
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out for opportunities and at the same time beware of the short term factors which we may omit in haste of further progress.
Suresh Vagjiani - consulting editor before it happens. I hope you enjoy this edition, we are committed to improving this magazine with every edition so if you have any comments or suggestions please write to ABPL.
Asian Business Publications Ltd Karma Yoga House, 12 Hoxton Market (off Coronet Street), London N1 6HW. Tel: 020 7749 4085 Fax: 020 7749 4081 Email: aveditorial@abplgroup.com gseditorial@abplgroup.com www.abplgroup.com ©Asian Business Publications Ltd
DM Homes_A4 Temp 14/12/2012 15:50 Page 1
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fter a decade long boom the housing market came to a slump in 2008 and sales of properties have fallen nationally in the UK ever since. Undoubtedly the major changes in banking and lending, the credit crunch and the recession have overall impacted the value of properties, bringing its worth much lower than anticipated. This was the unfortunate truth for most homeowners up and down the country. However there have been a few exceptions like in the London Borough of Harrow. Despite the falling house prices nationally, Harrow has seen an increase. According to HM Land Registry the average house price in 2012 was approximately £360,000, which is a growth of 1.1% in the area. The significant growth is due to Harrow being able to offer a range of excellent schools, a wealth of shops, a choice of good transport links and a varied selection of properties. The area will continue to prosper as future development plans look to increase the number of homes and jobs in the area. Crime rates are lower than other boroughs and it’s a good place to live for families and affluent singles as well. Already boasting a rich and diverse heritage, Harrow continues to grow as a diverse borough with the largest group being of Indian ethnicity. This group continues to extend, as the types of people purchasing properties in Harrow are predominantly from the Asian background. No doubt the sellers have been quick to capitalise from the demand and in particular on properties that are very close to schools and tube stations. Sellers know buyers are more than willing to pay the asking price for the properties and frequently exceed figures on the asking price. In these circumstances the seller has the advantage as buyers are often told to give a best and final price as more than one buyer has offered the same or asking price. Properties that come onto the market are often sold in a matter of days as the demand is so great. Although many properties were sold in Harrow in 2012, according to the HM Land Registry the most popular types were flats. This could be due to new ‘key service workers’ type flats becoming available as well as first time buyers purchasing something more affordable than a 3 or 4 bedroom property. Investors took the P. 7
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HOUSING MARKET TO PICK UP IN 2013 opportunity to capitalise in a continually prosperous and growing area as the rental market also continues to be strong. Northwood, Pinner and Stanmore come under the north part of the borough and boasts areas of highly affluent housing with ease of access to central London making these areas incredibly popular for buyers to invest in.
Furthermore last year’s growth proved Harrow to be a good place to live and invest and for those who are selling, a great opportunity to maximise on the sale price in the current climate. To take full advantage when selling your property consider these factors: • Choose the right estate agent • Be flexible in viewing times • Complete any outstanding works • Declutter and tidy the property • Freshen up the property if dated
“Already boasting a rich and diverse heritage, Harrow continues to grow as a diverse borough with the largest group being of Indian ethnicity.”
Our predictions for 2013 2013 will be another good year for anyone looking to sell their property in Harrow as the demand to purchase continues steadily. On the purchasing side, buyers will be in better positions at buying as The Council of Mortgage Lenders has stated ‘affordable mortgage products are becoming more readily available’. With all that Harrow has to offer, those that are selling are in a very good position to demand healthy sums for their property.
Also the multiple attributes that Harrow offers appeals to single people, couples and families. Suitable for most, the high demand ranging from flats to 3 or 4 bedroom properties within the borough is still highly sought after.
Sales Director Kamlesh Padhra Infinity Property Solutions
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020 8907 4665 www.inf inityps.co.uk
184 Kenton Road, Kenton, Harrow, HA3 8BL info@infinityps.co.uk
Furniturewell Ltd_A4 Temp 24/07/2013 16:06 Page 1 *
Subject to terms and conditions as stated on the Infinity Property Solutions sales agreement.
Furniturewell Ltd offers one stop shop for your home improvements and refurbishment projects
l Bespoke kitchen l Fitted wardrobes l Production l Installation We work to ensure we develop good relationship with our clients throughout the whole process from the initial contact to installation. We also offer installation of your furniture and joinery products through our teams of skilled fitters
52 Blackthorne Drive, London E4 6LS
Tel 07710 651 975
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ur homes and properties are usually the biggest assets we’ll ever own. We take pride in them, and often make improvements to suit our modern lifestyles. After all, everybody wants the perfect place to live. It’s quite easy to buy a sofa or choose a TV, but when it comes to windows and doors they affect the look of the building, and have a big impact on its energy efficiency. So it’s important to get it right. Yet most people (unsurprisingly) don’t understand how or why they should choose energy efficient glazing. Read on, and you’ll hopefully see how the benefits often outweigh the cost. Sustainable building has become a huge focus in recent years, with many government initiatives encouraging homeowners and developers to improve the energy performance of their properties. With windows and doors, one of the biggest changes was in 2010 when Energy Ratings were introduced. No longer confined to home appliances like fridges and washing machines, the energy efficiency of the whole building has become something all property owners should consider seriously. The constant drive for energy efficiency is still happening, most recently with the Government’s flagship Green Deal programme. It’s designed to encourage homeowners to make energy efficient home improvements, and reap the benefits of long term savings and added value. The UK is bound by international agreements to reduce carbon emissions and our outdated housing and building stock is the biggest contributor to our energy wastage. Whether we like it or not, something has to be done! Many readers will know that when you’re buying, selling or renting a property in the UK, you’ll need an Energy Performance Certificate (EPC). The EPC tells prospective buyers and tenants how efficient your building is. This often plays a critical role in their decision to buy, and will affect how much they’ll pay. If the property is highly rated (A-C) then you’re likely to attract a premium, as the buyer knows they’ll save money on energy and running costs. If the EPC shows a low rating (E-G) then you’ll probably lose out. In April 2018, proposed changes will mean a minimum E rating will be required and according to property consultants GVA the “marketability of some properties would become impossible unless they are P. 9
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WINDOWS & DOORS; A GREAT RETURN ON INVESTMENT upgraded in energy efficiency terms”. So what can you do? Replacing tired old first and second generation windows with modern, energy efficient and well-designed windows can make huge improvements to the value and efficiency of your home.
“If you make the right choices, and invest wisely, the return on investment for new energy efficient windows and doors can be huge ” Unlike most purchases we make, the right choice of windows and doors can give you an immediate payback by adding thousands of pounds to the value of your property. They can also save you money from the moment the installation is complete.
Refer to the EPC of your property; if you don’t have one, you can get a survey carried out. Once you know what rating your property has, speak to experts to find out what can be done to improve your rating. I’d advise customers to install modern A-rated windows and doors, particularly if yours were installed before 2002. Use an energy savings calculator to give you an idea of the potential savings you can make. Go to www.everglade. co.uk/energy-saving/ and try it yourself – you could save thousands of pounds! It’s important to remember that choosing the most energy efficient windows and doors alone isn’t usually enough. To get the best performance choose a fully accredited and experienced installation company. If you make the right choices, and invest wisely, the return on investment for new energy efficient windows and doors can be huge.
Windows & Doors Expert Jayesh Patel Everglade Windows Ltd
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THE POWER OF LEVERAGE
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raise capital against the property. Before the property crash in 2007, house prices soared at an incredible rate.
Borrowers used to stay with the same lender for the full mortgage term, in the same way people use to stay with their spouses their whole life! We are living in a faster world where borrowers switch as soon as they see a margin to be saved.
Borrowers released capital from their properties for various reasons however, since the crash, property prices dropped considerably. Many borrowers who over indulged now face the possibility of negative equity. In simple terms the value of your house is lower than the balance of your mortgage. This class of investor is stuck with their existing lender as transferring lenders means they will have to put money they haven’t got into the property.
remortgage (also known as refinancing) is the process of paying off a mortgage with your existing lender with the proceeds from a new mortgage with a different lender using the same property as security.
In recent years mortgage rates have fallen as never before, so many people have reviewed their mortgage rates and saved themselves thousands of pounds in repayments. So why would you consider remortgaging to a different lender? The three main reasons are: • To arrange a cheaper deal • To consolidate debt, meaning instead of several different debts you have one • To release capital/equity There is usually an option for any borrower to secure a better arrangement once their current deal ends. If your existing lender cannot offer you a competitive deal then you should always consider switching your mortgage to a different lender with better terms. When consolidating debt, it is important to remember that although the interest rates and monthly payments on a mortgage are usually much lower than that of a Credit Card or loan, leveraging off property is a cheaper form of debt management. The term of a mortgage is much longer therefore you may eventually pay more in interest. You should always consider the overall cost before consolidating any debt. The other reason people remortgage is to
“This is definitely a buyer’s market where one can get deals which never existed prior to the credit crunch.”
Thankfully house prices in many areas of the UK have started to rise again and the opportunity to raise capital is gaining momentum. In addition to improvements on their main residence, many people raise capital from their main residence to buy investment property with the help of a Buy To Let or arrange further borrowing to buy a property outright. The latter is a better option when buying property at auction due to the limited time span (normally 28 days) to secure the purchase, as well as obtaining a more favourable rate on the residential home. Buying investment property in cash has the obvious advantage of no finance costs
or monthly mortgage repayments. The down side to this is that your money is stuck in your property and most lenders will not allow you to remortgage or raise capital from a property within a 6 month period from completion. There are however a few lenders that will allow the borrowers to raise capital within 6 months if you have an astute broker. This capital could be used to purchase additional property or make improvements to their own home or other properties they have. Renovating or expanding a property can add value to your investment. With lower savings rates and volatile investment markets, property is gaining popularity as a safe haven for many investors. With more people renting than buying, investment property should be a serious consideration for any investor. This is definitely a buyer’s market where one can get deals which never existed prior to the credit crunch. To summarize, it is always a good idea to regularly review your mortgage situation about a month before the actual end and you are free of any Early Redemption Charges (ERC’s). Remortgaging can benefit you by lowering your payments, reducing your overall outgoings or improving your investment portfolio. Consider all available options and always discuss your options with your IFA before you decide it is worthwhile going ahead. Also be aware that your home may be repossessed if you do not keep up payments on your mortgage.
Financial Advisor Pank Parekh MPI Investments Ltd HOUSE AND HOME
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MINIMISING YOUR COSTS IN A DIVORCE BATTLE
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ivorce, Children and Financial matters can be settled without the need to go to the Court as long as both parties agree. It is when the parties are not in agreement that the solicitors are often instructed to do further work and the legal charges come into play. Many people often believe that in order to commence divorce proceedings and settle financial matters, they would need to attend Court, but this is not always the case. If possible, it is advised that both parties try to settle matters on amicable basis before they take their cases to their respective solicitors. Divorce can be for most people, a traumatising experience and therefore the less acrimonious it is, the better it is for both parties. Divorce In order to keep the costs to a minimum it is advised to avoid contesting divorce proceedings. As a solicitor, with over 11 years post qualification experience, I have only dealt with 2 contested divorces. This is an indication that in most cases divorce proceeding are rarely disputed and the parties accept that once proceeding are issued marriage is over.
The Divorce procedure involves the following steps: 1. Issuing the Divorce petition – The party starting the divorce proceedings (Petitioner) issues the divorce petition at Court and this is then served on the other party (Respondent). 2. Acknowledgment of Service – The Court will then serve the issued Divorce petition on the Respondent who will be required to sign this form and return this to the Court. 3. Decree Nisi – This is the initial step in finalising the Divorce before decree absolute is granted by the Court, having assessed all the documents.
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4. Decree Absolute – this is the final part of the Divorce and confirms that the marriage is dissolved.
Mediation, if successful can in some cases assist in order to avoid Court proceedings.
Unless disputed, the whole divorce procedure takes about 6-9 months to complete. Where all the matters are agreed upon, most solicitors will charge a fixed fee to deal with a straight forward divorce case.
• The parties if agree can be referred to local Mediation groups who are experts and assist the parties to mediate and settle matters, outside of the legal arena. Once all the financial matters are agreed, then one of the party’s solicitor can prepare the Financial Agreement.
“As a solicitor,
with over 11 years post qualification experience, I have only dealt with 2 contested divorces.”
Financial Matters The financial matters can be resolved in many ways to keep the legal costs at a minimum, for example: • Where possible if the agreement has been reached between the respective parties, the solicitor can then prepare a Financial Agreement. This is then sealed by the Court. • A “Round Table Meeting” could be arranged which is when both parties attend a mediation session represented by their respective solicitors in order to resolve all the financial disputes at hand. • If the parties are still unable to reach an amicable solution, then the solicitors can negotiate on behalf of the parties, however, the legal charges will depend on how much negotiation takes place and how quickly the matter settles.
If an Agreement by any of the above methods is not reached then it may become necessary to issue financial proceedings at Court. This is likely to incur high legal costs and should be avoided, if at all possible. Children’s Matters Again the Legal costs can be minimised by parties agreeing the issues relating to the Children in respect of child contact, maintenance and residence. If there are major disagreements between the parties then the matters may be decided by the Courts in which case these Court proceedings can be very expensive depending on the complexity of the case. Although the above methods are a sensible approach to settling Divorce, Children and Financial matters, it is not always possible for the parties to reach an amicable solution without the involvement of solicitors and Courts. In such cases it is advised that they should take into consideration the effect this will have on their legal expenses. The parties may request an estimate of their legal costs from their solicitor at the outset of their matter. Family Law Expert Anna Patel Ansham White Solicitors
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A PERSPECTIVE FROM A PROPERTY MOGUL An interview with former Dragon and property mastermind James Caan, by Suresh Vagjiani of Sow & Reap What do you think the prospects are for the UK property market and Central London specifically? To look at the market as a whole, sales are finally on the up. However the national property market is more fragmented than ever before, with the bright spots being all about location. Mortgages are the key to the national property market, and thanks to George Osborne’s Budget measures the new Help to Buy scheme will no doubt give
the national market the boost it so greatly requires. This is a boost not only for sellers and buyers, but crucially it will encourage more house building.
“So long as sterling remains undervalued against the dollar, demand for central London property is set to remain strong”
We should not forget however that there is still a clear divide in the performance of property values in the capital and in the rest of the country. It is the strength of demand from overseas buyers that has driven up prices in London boroughs - the market is ultimately driven by supply and demand, and with demand consistently outstripping supply values are only forecasted to rise. With increased investment into central London, there is clear evidence of the ripple of wealth out of London into key commuter regions, and with the addition of HS2, properties at the terminal of the line will see their potential value soar. It’s critical that London remains active in order for wealth to migrate across the country’s prime markets. Many commentators are saying this rise is unsustainable, Do you think this rise is sustainable and if so why? What shouldn’t be forgotten is the desperate shortage of housing in central London, so I revert again to my point touched upon above regarding supply and demand. It is the strength of demand that is increasing capital values. London housing is considered extremely safe in terms of investment value, even though yields are
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relatively poor - super prime residential property still remains at the top of the list for the majority of investors out there.
platform has been the strength of the founding team - this harks back to my mantra of “backing people with passion”.
As it’s international demand that is sustaining this growth, so long as sterling remains under-valued against the dollar, demand for central London property is set to remain strong. London is much less volatile than some other prime world markets.
I’m also personally active in the prime residential market. Currently I’m developing a 13,000 sq ft residence in the heart of Knightsbridge; the property should be worth in the region of £55m upon completion.
Can you tell us what property investments you have done recently and where your property arm HB Real Estate is looking to focus on currently? I co-founded HB Real Estate with Faisal Butt and we share a vision of building a portfolio of 20 “disruptive” start-ups that will challenge the established giants. Our first investment, 90 North Real Estate Partners, is a property investment advisory firm and fund specialising in Shari’ahcompliant investments. The business has purchased £90m worth of UK deals in last 18 months, with another £100m in the pipeline.
“With some of the best schools and universities in Europe, an attractive time zone and strict financial regulation, London has a number of less tangible characteristics that are unique to this country and give London a significant advantage over other cities across the globe” More recently both Faisal and I have launched a London estate agency called Ivy Gate, the business was founded by “all-star” estate agent Jason Tebb and we aim to bring a US-style realtor approach to selling homes to West and Central London. The common thread across all of the businesses founded on my venture capital P. 1 3
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The rise of central London property has been largely due to foreign money coming in to the UK, as opposed to domestic created wealth. Therefore it can be argued this is not a balanced reason for property values increasing, and will be short-lived. What’s your view on this? With some of the best schools and universities in Europe, an attractive time zone and strict financial regulation, London has a number of less tangible characteristics that are unique to this country and give London a significant advantage over other
cities across the globe. Foreign investors (along with their family) love London and that’s not something that’s going to change overnight. As long as London remains a leading financial centre of the world, I can’t see foreign investment into London property diminishing. With the current economic situation what will be your advice to our readers who would like to step into the property market as an investment? The investment market consists of a number of sub sectors – buy to let, residential development, commercial investment etc. So really the one piece of advice I could give that spans the entire spectrum, is to ensure you really understand the market where you are buying and crucially remember that property investment requires a longterm view. No one investor should rely on prices rising in the short term.
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TO MOVE OR NOT TO MOVE, THAT IS THE QUESTION
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f you have outgrown your existing living accommodation, why not stay put and carry out home improvements : extend and enhance your existing home. There are beneficial financial reasons for staying in your existing property. The cost of a move quickly mounts up. You can save the costs of estate agents fees, moving and storage and stamp duty on a new purchase and associated legal fees by staying and improving your existing property. This will add capital value on exit whilst enhancing your existing quality of life.
dig out to give you that much needed entertainment, casual dining and family area spilling out into a garden.
“Just as space reconfiguration and optimising its utility is critical to easy living so is creating functional interiors.”
If you love the home you live in but just need more space, you could improve and enhance it in the following ways:• • • •
Structural Reconfiguration Functional Finishing touches
Structurally you can extend outwards, upwards or downwards subject to building control and planning permission being granted and friendly neighbours of course. If you have space to the rear, the most economical way is to add a conservatory, preferably a modern one with a flat roof and glass lanterns. Next up is a loft conversion to create an extra bedroom, study or playroom. If you have a corner property or one with a large footprint, consider a basement
A client’s house on the Hyde Park Estate had an unusable basement – the central staircase stopped on the ground floor and the secondary staircase continued to the kitchen in the basement which housed old dumb waiter machinery and unusable space. I created a whole entertainment suite, family and dining area, made a feature of the staircase by continuing to the basement and blocked off the secondary staircase creating wardrobes and ensuites at each level transforming the house into a 5 bedroom 5 ensuite with an ROI of 40% on exit. If you cannot extend, try reconfiguring the spatial layout to accommodate the way your family lives. This often means changes at ground or basement level. Create an informal dining area, put in a
new kitchen with a long central island incorporating breakfast bar, grill and griddle cooking facilities, conceal water based appliances like dishwashers and sinks behind sliding doors, create a utility/ laundry room, plant room, create storage for bikes, pushchairs and suitcases and ensure the guest cloakroom incorporates a wet room for the sportspeople in your family. Historically, the number of bedrooms in a property mattered; now it is the size of principal bedroom suite with ensuite his and her facilities and walk in wardrobes. Combine other bedrooms to create one large bedroom and for children have a shared ‘Jack and Jill’ bathroom or back to back shower rooms if space is a constraint. Just as space reconfiguration and optimising its utility is critical to easy living so is creating functional interiors. Kitchens are where the entire family congregates. Use handless cabinetry for a touch of simple modernity, glass splashbacks for easy wiping and for worktops, remember marble’s porosity means granite is a better choice. Corian, silestone and quartz are equally effective. Bathrooms should be neutral and well appointed with ‘state of the art’ showers. Have walk in showers and baths as centrepieces cast in polished limestone to make an impact. For heating, go minimalistic with skirting or tall radiators but keep these simple and
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preferably make these blend in with the background wall colour rather than stand out. Always use underfloor heating on tiled floors in bathrooms.
you plan to sell on, then it is wise to spend on a home automated system incorporating lighting and AV as it will show you have modernised your property.
Finishing touches – the icing on the cake are lighting, wall and floor finishes and window treatments.
Wall and floor finishes and window treatments is what meets the eye. Go neutral on wall finishes, its easy on the eye and restful, use wallpaper or polished plaster for those feature walls in the living room and principal bedroom. Always select good quality marble, honed limestone, porcelain or mosaic tiles and fully tile not partially tile bathrooms.
Lighting is critical to get right, incorporate crestron or lutron as part of your home automatican system, so don’t hesitate to spend on this. Highlight feature walls with downlighters or wall washers to create mood, atmosphere and ambience. Use floor lights in corners or under plants. If
There is huge choice of flooring; wood flooring, carpet, natural floor covering, marble. Use wood flooring in reception areas and basements, natural floor coverings on staircases and carpet in bedrooms, marble, limestone and porcelain tiles in kitchen and bathrooms. For window treatments, hang lined silk curtains on poles or behind pelmets simply rather than with swags and tails with roman blinds behind, never in silk as these will fray in the sun. Go to town on poles and pelmets, finials and tie backs. Your curtains frame the window and should be luxurious in texture and choice of fabric
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and soft in colour. First impressions count. If you are enhancing your property for sale, decorate the front door and light up the porch or entrance. Make sure your front garden is tidy and planters freshly potted. Always ensure the front of the house is redecorated and that any steps leading up to the front door are well lit. Rear gardens should have dedicated areas like a patio/terrace for seating or barbeque, a greenhouse to stow away spare garden furniture and tools, well maintained lawn, trimmed shrubs, creepers and trees against perimeter fencing and walls and preferably a central water feature which is back lit and viewable from the upper floors. If you do all of the above, you will love your home so much you might never want to move. More importantly, the enhancements you will have made will make your home appreciate considerably.
Property Finder & Interior Designer Shiuli Davis Metro-pad
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sh and Mena had been planning to extend their 3 bedroom detached house in Stanmore for a few years, and had engaged an Architect to draw up plans and obtain planning approval. They have two children and needed 4 good sized bedrooms and an office as Ash, an IT Consultant often works from home, as well as a large open family/ kitchen area for entertaining. The approved plans were designed with a double storey extension to all 3 sides of the house and an unusually shaped loft room, and with most of the internal walls being demolished. They had already vacated the house, and started the stripping out process to save them some money and time, before their contractor took over the site and commenced excavating the foundations. The only problem was that their plans were not adequate and lacked detailed building and structural information, and their contractor was unable to proceed any further.
AT HOME WITH KISH ‘This is the first time we had ventured into such a project, and weren’t aware of the process and procedures, and we just assumed our Architect would give us the correct advice’ explained Ash. ‘We then appointed another Consultant who worked locally, and was recommenced by several of our friends. The first thing he said when
he saw the house and our plans was: I think you should knock it down and rebuild it…!!’. This had come as a complete shock to Ash and Mena, who had never contemplated such a drastic approach, and their immediate reaction was that it would be
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too expensive and more than they could afford. ‘The building consultant spent a lot of time with us, and explained that there wouldn’t be much of the existing house left, and the layout and appearance would be that of a jumbled building with mis-matched brickwork, so we began to reconsider. What tipped the scale for us was the fact that a new house would be built to our requirements and would ultimately be more cost effective as New Build Homes are 0% rated for VAT, so the additional cost of rebuilding would be offset against the VAT we would save. We simply had no idea about this at the start’, recounts Mena. So, they set about redesigning their new dream home, and applying for planning permission again. This was no easy option, and took another year including lodging an Appeal against their initial refusal. Planning permission was eventually granted, but with Conditions attached,
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mainly in respect of the sustainability of the house. They had to meet strict criteria for the insulation, efficiency of the services and the environmental impact of the materials used in the construction. The plot was also located within a flood risk zone, and provisions had to be made to ensure minimal risk to the structure from any potential flooding that could occur. In addition to this, a water tank had to be installed to store rainwater to ensure that the existing sewers were not stressed in times of heavy rainfall. ‘We had to employ more specialist consultants to assist in dealing with these issues, but I didn’t mind so much, as we wanted the house as Eco-friendly as possible,’ describes Ash. Solar panels, additional insulation in the floor, wall and roof, under-floor heating to all 3 floors powered by a highly efficient Condensing boiler, and low energy LED lighting, were just some of the features included in the design of the house. A
domestic sprinkler system was also necessary to comply with building regulations to allow them to have an open plan ground floor design. The whole ground floor is an open plan area covered with a unique black and white seamless resin finish, which steps down to the kitchen at a lower level which was designed to follow the natural ground level, and allow for a higher ceiling level. The south facing bi-fold doors flood the living area with natural light and warmth, and join the lounge to the garden when entertaining. ‘The whole process was a real rollercoaster ride, and we’ve learned a lot, and wouldn’t want to go through with it again. However, we’re glad we did, and would advise others to make sure they get the right people working with them from the start.’ Building Design Expert Kish Bhudia KDB Design
Simba Enterprise Ltd_A4 Temp 19/08/2013 12:13 Page 1
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Financial Advice and Wealth Management Mortgages Whether you are considering a new home for yourself, for Investment purposes or simply remortgaging we have access to a wide range of lending options for you to consider. We can help you secure the best deal for your circumstances on residential, commercial or buy to let property. Pensions People are more concerned about their retirement provision than ever before. Remember, the right Pension provision can allow you to achieve your dreams and aspirations in retirement. We advise and arrange both personal and company pensions ensuring the best solution to safeguard your retirement income. Insurance & Protection Premature death or serious illness can affect your family, your home or your business. It is important to have adequate protection. At present many people are under insured or have no cover in place. At MPI we can advise and arrange life and critical illness cover, income protection, unemployment cover as well as home or commercial insurance giving you peace of mind in whatever the future brings. Savings & Investments You may be perfectly capable planning your investments but there is no guarantee that you will make the right choice. Also, choosing and watching your investments can be a surprisingly time-consuming business. Whether you want to grow your capital, increase your income or both, MPI have access to a wide range of investment solutions to match your individual requirements from savings accounts to complex investment planning. Inheritance Tax Planning Inheritance Tax is a tax payable by a person, usually a family member who inherits the Estate (money or property) of a person who has died. There are however, ways to reduce this liability which would ensure your beneficiaries receive what’s rightfully theirs. This tax doesn’t only affect the rich. Those with fairly moderate wealth should also be aware of their options. If you are concerned about your children’s inheritance, we can help you reduce your liabilities through effective tax planning.
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A
sian House and Home readers may be well aware of the usual methods of adding value to existing properties using building contractors. Frequently builders are called upon to refurbish the existing property by adding a single/ double storey rear/side extension and/or a loft conversion. These types of projects are prevalent in most residential areas as local councils are generally relaxed on planning consents that involve these types of development. If the property is in a Conservation Area or the building in question is of historical importance and is therefore Listed, the rules for development are more onerous, but are still generally permitted with careful consideration by architects and local planners. London and in particular central London areas, where residential properties simply do not have the luxury of space to extend in any direction without having further issues that need resolving, i.e Rights of Light etc are seeing an increase in Subterranean (Basement) extensions to increase the asset value or standards of living obtainable from the property. The Common Law definition of land extends from the centre of the earth to the sky, including not only the surface but also the soil beneath it and the air above it and all things growing on it or attached to it, but does not include minerals belonging to the Crown. If you are short of space and have nowhere else to go, think of the valuable space beneath your feet, that you also own! Subterranean extensions are possible to be carried out to almost all types of properties, but before setting out on a project of this nature, the following are key issues to be borne in mind. A competent design team must be employed to carry out a basement extension and an experienced builder must be engaged for the structural works. Structural engineers, architects and party wall surveyors should all work together to provide a deliverable scheme that meets the interests of all relevant stakeholders. Planning and Building regulations consent is required for basement extensions. The existing ground conditions beneath the property are until surveyed properly, an unknown entity and impact the construction methodology to be employed in creating the new basement. It is essential to carry out a full site investigation survey as it is the basis upon which the design team will begin their design details from.
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SUBTERRANEAN EXTENSIONS Despite taking all the necessary, prudent and precautionary steps to design a safe and trouble free basement extension, the very fact that you are digging into the ground where you simply cannot foresee, fully, what lies beneath is where the majority of your project risk (impacting cost and time) lies.
“If you are short of space and have nowhere else to go, think of the valuable space beneath your feet, that you also own!”
There have been examples during basement excavations of finding ‘lost rivers’, Roman ruins, unexploded bombs and bomb shelters. For example a project in Mayfair, London on Upper Brook Street where Vascroft were creating a triple level basement, a ‘lost’ river was found when forming the third level of the basement! It is clear that the street name used today was given as once upon a time it was a place that had a brook (river). No site surveys showed any signs of a river running beneath the property and this took everybody involved by surprise. With the
competent design and construction team, the river was successfully diverted around the property for works to continue, without significant problems. It just shows that even the professionals face unknowns and hence any basement project must be approached with the utmost respect for nature and tackled with great care and attention. The Royal London Borough of Kensington & Chelsea have recently issued a consultation with new draft rules that will limit basements to a single storey and impose much tighter limits on how far they can extend under a garden. There has been a surge in applications for basements over recent years as property owners have sought to by-pass planning restrictions on changes to their homes above ground by massively extending their living space underneath. Their plans propose to limit the amount of space that can be taken up under the garden from 85 per cent to 50 per cent; stop basements being dug under listed buildings and require the compulsory installation of pumps to prevent flooding from sewers. Subterranean extensions are on the rise and you may want to start the process on your property before your local authority follows a similar approach to limit them.
Construction Expert Mitesh Vekaria Vascroft Contractors Ltd
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UK HOUSE PRICES BUOYANT WITH STRONGEST GROWTH IN THREE YEARS
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roperty sales in the UK are on the way up again and starting to firm nationally, while better mortgage deals are being offered by lenders and confidence amongst buyers returns. That said, certain issues still lurk in the property market that investors should be aware of. it is also having an impact on the rental market, which is showing a broadly similar picture across the nation. According to a recent Royal Institution of Chartered Surveyors (‘RICS’) monthly report (May 2013) house prices posted their first slight rise since June 2010, with estate agents having started to witness the effects of cheaper mortgages thanks to the £80 billion ‘Funding for Lending’ scheme unveiled by Chancellor George Osborne. This contrasts with gross mortgage lending in 2012 totalling some £140bn, according to the Council of Mortgage Lenders. The RICS report came after a forecast from the Centre for Economics and Business Research (‘CEBR’) indicating that the cost of the average home will surge by nearly £50,000 over the next five years. The CEBR suggested that house prices will exceed their pre-crisis peak for the first time in 2013 - reaching an average of £227,000. And by 2018, they predict the cost of the typical UK home will be £267,000. Historically house prices in the UK have exhibited a degree of volatility. The last boom, which spanned a decade, was
stopped in its tracks in 2008 after the market peaked in late summer 2007. As prices tumbled banks and mortgage lenders compounded the situation by pulling back on easy lending and high lending multiples. Many economists had long predicted the market would turn, although pinpointing the market’s exact trajectory is always fiendishly hard.
This firm, which provides specialist insight into the property market, revealed that prices rose 0.3% month-on-month in the traditionally slow month of July - down from rises of 0.4% recorded for both May and June 2013. Across England and Wales, 29% off postcode districts registered increases over the latest monthly analysis on record, falling back just slightly from 31% in June, which had seen the biggest uplift in almost six years.
“Improved confidence - both among lenders and buyers - and a limited supply of properties is driving up values, plus the new Government schemes have given the whole market a boost.”
However, the UK property market still presents a divided picture with strong gains in particular in London and the South East, while Wales and the North West post smaller rises. Some prices are even still falling in all other regions, including significant declines in parts of the north of England and Scotland. Buyers should also be aware that in London there is a variance between hot spots and low spots between areas and boroughs.
This July property values in the UK were 1.3% higher than they were a year ago and have risen year on year, for the sixth month in a row. And, depending on how the market performs this autumn, 2013 could see the highest rise in prices since the economic downturn, according to property analyst firm Hometrack (www.hometrack.co.uk). Richard Donnell, director of research at Hometrack, stated: “The year has got off to a strong start.”
In Scotland, however, 16% more chartered surveyors reported that prices rose rather than fell in June and 31% more respondents reported that prices will rise rather than fall over the coming three months. Rising numbers of prospective buyers returning to the market there has fuelled matters. David Newnes, Director of LSL Property Services and Owners of Your Move and Reeds Rains, commenting late this July said: “Momentum is growing in the housing market. The first time buyer HOUSE AND HOME
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To-Value (‘LTV’) mortgages. “Even though first time buyer activity is lagging far behind its pre-2008 levels, there are good signs that progress is being made,” said Newnes. “The first-time buyer market is thawing, and that will energise the whole property chain, which will keep house prices moving steadily up as long as house building remains low. We expect more lower income buyers to flock to the market and help stimulate growth across the board.”
market is showing it is ready to bounce back after a tough past couple of years, and the market is no longer dominated by equity rich buyers.” He added: “Improved confidence - both among lenders and buyers - and a limited supply of properties is driving up values,
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plus the new Government schemes have given the whole market a boost.” Indeed, the availability of cheaper mortgages has significantly improved in the past few months allowing banks to access cheaper credit and enabling them to loosen the purse strings on higher Loan-
While falling property prices have resulted in tough times for those who have seen the equity in their properties reduce dramatically, seen some fall into negative equity or even had their homes repossessed, others have reaped opportunities on that downturn. And, the elephant in the room that could upset the apple cart is the potential for rising Bank of England base rates. As ever, Caveat Emptor - Buyer Beware.
Financial Freelance Expert Roger Aitken
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THE RIGHT BAIT FOR THE RIGHT CATCH
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hen employing a builder for an investment property, time is an important factor. Delayed projects often mean more mortgage payments and may be missing the market highs. When employing a builder for an investment property it is important to define what the purpose of the refurbishment is. Is it to resell the property for the maximum amount the property is worth or is it to rent out on a long term basis? In each scenario the build work would have a different objective. In the first situation you would need to pay careful attention to the finishing and ensure the property is presented as a show home to get the most value from it. In the second situation you need to think in a different way, the property needs to be finished to a standard where it can easily be redone, and the materials are hard wearing. For instance you cannot use a real hard wood floor in a rental property as it is likely to scratch and damage very quickly. A laminated or engineered wood floor would be more appropriate. It is very important to keep budget in mind
and to keep ones emotions out of the project. Each expense must be justified, for example will putting under floor heating give me more rent or increase the resale price, if so by how much?
“The property will need to be done according to what the market dictates and not what takes your fancy”
A current project we are engaged in is a 1st Floor, three bedroom property in a purpose built portered block in Kensington. It’s a 1400 Sq. Ft Lateral apartment which originally was a probate property. Here the property is being refurbished for a resell. A designer was employed to ensure the specification has been done to a high standard, various bits which are new to the market have been sourced from trade shows. These ideas have been then incorporated into the design. The finished flat will be fully furnished with painting, mirrors and cushions. The aim is to resell this property by putting it on the market in September this year.
The property will need to be done according to what the market dictates and not what takes your fancy, if for example an area is popular with families the property will need to take children and safety more into account than if it is aimed at bachelors.
It’s important the builder you employ is aware of your aim for the investment property you purchase. This will mean they are able to give you advice on the project according to your end result you have in mind.
Some level of market research is required the best way to do this is contact local agents, they will be more than happy to help with the hope they will receive the instruction for the property.
Home Improvement Expert Silyia Petkova Furniturewell Ltd HOUSE AND HOME
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UP. DOWN. IN. OUT... DON’T SELL IT ALL ABOUT
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ot only is the recession still having an impact, but asking prices are going up meaning that moving home is now so expensive. Many homeowners are opting to improve rather than move. Value for money has never been as important as it is today. It seems prudent, therefore to invest money in a chartered Architect to help maximise your current home’s potential rather than throw good money away on levy, stamp duty, legal, mortgage, moving costs etc….. Whether you have had a new baby, your children are growing up, you have begun to work from home and you now need more space it could be possible to keep your home, with its memories by expanding up, down, in or out. So what can you do? You could go up with a roof conversion/ extension, perhaps dig down for a basement, consider looking inwards at the current layout and materials to save money on bills or live more efficiently or perhaps extend out to the side, back or front of your home. Some ways are cheaper, quicker and better than others, some require planning permission but some are considered permitted developments. Alterations usually require ‘Building Control Approval’ and then there is the matter of choosing a builder and looking at insurance cover. Have you thought of how the sun travels around your property, or how to integrate the old with the new?
Time is money Are you able to spend the time researching all the options available and can you afford to make mistakes at an increased risk, or should you invest money in a professional for less risk? Our Architectural office has demonstrated consistently that investing in good design from the outset provides better value for money and enhanced quality of life.
“Whether you have had a new baby, your children are growing up, you have begun to work from home and you now need more space it could be possible to keep your home, with its memories” Anyone can practice architecture, but only certified people can call themselves Chartered Architects. The protected title of Architect means that you get value for money, have a reduced risk as they must comply with the Architects Act, and you can be free from worry. An architect can find you the extra light and space you didn’t know you had, suggest materials you hadn’t thought of and help you find the right builder at the right price. An architect will guide you through the complex web of planning laws, applications, regulations and contracts, acts as a mediator between the different professionals, can
monitor the construction work through to completion and many more things. When you change your mind on site, it is costly, so an Architect will help you to consider everything before it gets to this stage. Did you know you can also protect your property’s value from degradation due to neighbour’s alterations, rights of light etc? Money Well Spent It makes sense to use a professional who understands your concerns. At Arc 3 we treat each project as if it is our own property. As architects, we know the systems, policies and usually act on your behalf to coordinate with the other professionals. We operate in a creative environment, thinking outside the box. Architects are not just used for grand schemes, but for all scales of alteration. They offer advice and consultancy from changing your windows to a two-storey extension in addition to new-builds. When it eventually comes to selling your home, your potential buyers are usually very selective, but when they see the right thing they will pay a higher premium. Architects see beyond your immediate needs and take a more objective view of your home, taking into account the future resale of your property, helping you take a more informed decision of whether to go in, out, up or down before selling up. Architect Expert Mayur Vashee Arc 3 Architects & Surveyors
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BEWARE: PROPERTY EXTENSIONS CAN BE TRICKY
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growing number of property owners are building extensions and making other alterations. But it can be a risky business unless you know what you’re doing. Certainly, doing extensions can add value to your property, as well as maximise the use of space. So it can often be a wise investment. But before you start you need to consider what kind of consent you will need, and from whom. If you’re a leaseholder you may want to carry out improvements and alterations. If so, in addition to obtaining local authority consent you must apply for the landlord’s consent before going ahead. This is invariably a requirement of any lease. Whatever the nature of the work, you should check with your landlord that the work is permitted, and obtain any written confirmation or relevant licences. If you carry out any alterations or improvements without permission you will be breaking the terms of your lease. In such instances, legal action to stop any further work or to reverse any work already done is likely. That can be costly and time consuming. In extreme cases, the breach can lead to a cancellation of your lease by the landlord, who may then reclaim the property, leaving you effectively homeless. As well as landlord consent, you will need planning permission from the council and approvals from building control, usually known as building regulations consent. Most councils have separate departments dealing with each. The council consents apply to both freehold and leasehold properties. Some alterations don’t require planning
permission from the council, and these are sometimes referred to as ‘permitted development’. For example, domestic extensions such as conservatories are okay as long as they are within a certain size. But you should always check with the council’s Development Control department. Where you are a leaseholder, regardless of whether council consents are required or not, the freeholder’s approval and consent is always needed.
the breach may range from complete demolition to modification. The costs of dealing with this may be considerable. The council can apply other sanctions too, making things even more expensive for you.
As Navinder Singh, solicitor at Mark and Co, explains: “You may well think that as your neighbours have a similar extension that should be fine. However, this is a very dangerous approach, as all consents are given based on different properties and circumstances. Who is to say your neighbour did the work legally in the first place?”
As Navinder explains: “We had a client recently who purchased a piece of land to develop. Unfortunately the client thought that due to his contacts in various council departments it would be certain he would get the planning and building regulation consents. The client subsequently continued with the work, and it was later established neither of the consents could be granted. As a result, not only did the client have the costs of returning the land to its former position but has also been left with a piece of land bought at a substantial price.”
“There will always be the opportunity to make money from developing land and existing properties, if it isn’t done in the right way you could easily find yourself seriously out of pocket.” There are various types of action the council can take when the appropriate consents haven’t been obtained. The main one is an enforcement notice. Such a notice will specify the breach of planning control, the steps required to remedy the breach, and the period of time allowed for compliance. The period starts 28 days from the date of the notice. The steps required to remedy
In more serious cases, the council may choose to serve an injunction. Failure to comply will be viewed as a contempt of court for which serious penalties would apply.
Navinder continues: “It is these types of scenarios which we want our clients to avoid. Not only does it potentially cost them to remedy breaches, but the stress and time involved also has a negative impact on individuals. We always stress that before doing any work affecting a property to make some simple calls to establish what consents are required.” There will always be the opportunity to make money from developing land and existing properties, but if it isn’t done in the right way you could easily find yourself seriously out of pocket. Conveyancing Expert Vijay Chandras Mark & Co Solicitors HOUSE AND HOME
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HOW TO SPLIT A HOUSE INTO FLATS
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ith a drastic shortage of housing in London, and an ever increasing demand for affordable housing, combined with restrictions on building on green belt land, how on earth can new units be created? The answer may lie in converting larger houses into smaller units. This is by no means a new concept, as Central London is full of examples of large Victorian terraces split into smaller self contained units. Converting a house during the 1960’s required a separate door and some carpet on the upper floors for sound proofing. This is a far cry from the stringent regulations in place today. Each local authority will have their own established conventions and policy that have to be adhered to, but there are some principle rules that are common. The most obvious starting point is to ensure the house lends itself for conversion, and the critical issues and concerns are the size, layout, and location. All new homes have to comply with current standards, and these guidelines also extend to new units formed by conversion. Important aspects to consider before embarking upon such a development: Access – New units must be accessible and useable by disabled persons. Therefore room, corridor and door sizes must be designed to facilitate future wheelchair access, and the bathroom to be adaptable if the need arises. A ramped access and disabled parking facility may be required. Sound Proofing – All new compartment
walls & floors between the units must achieve minimum fire and sound resistance levels, and there are several methods of achieving this. A sound test is required upon completion. Also the layout and design of the units must allow for like rooms to be stacked above or adjacent to each other, to minimise noise transfer, e.g. from a lounge to a bedroom. Thermal Insulation – The external fabric of the building will need to be insulated to bring the walls, floors, roof and windows to current standards. This is probably one of the most tedious and expensive elements of a conversion scheme, as it requires the complete removal of all the plastering and adding insulated boards to the walls.
“Converting a house during the 1960’s required a separate door and some carpet on the upper floors for sound proofing. This is a far cry from the stringent regulations in place today. ”
Car Parking – Off-street parking space is a well sought after aspect if it can be accommodated. A new unit on any given street will inevitably lead to more on street parking and congestion, and as such some councils will restrict any further developments on heavily parked streets, or streets that already exceed a limit on flat conversions. On streets that have
controlled parking zones, it may be possible to enter into a Section 106 Agreement for a ‘car-less’ development, which means that the new unit will not be entitled to a residents parking permit. However, this can often de-value the apartment. Council Infrastructure Levy / Section 106 Agreement – These are essentially facilities that allow the local authority to make a charge for new developments based on either floor area or number of rooms. As an example this figure can range from £25/ sqm or £3000 per habitable room. The London Housing Design Guide is the bible for any developer embarking on such projects. It contains very useful information for designers, and is also a benchmark document used by planning officers in deciding upon the viability of a planning application for conversion or new build homes. A more recent phenomena we have witnessed lately in areas becoming gentrified by the young affluent professionals is the conversion of ‘converted flats’ back into larger family homes, often with space for live-in staff/ helpers. If you are contemplating buying a property for conversion purposes, it would be prudent to speak with a professional who has local knowledge of the council policy on flat conversions first. Building Design Expert Kish Bhudia KDB Design HOUSE AND HOME
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Ansham White_A4 Temp 08/08/2013 15:23 Page 1
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We are an ambitious partnership with vast experience which draws on longstanding relations with a huge network of clients and business referrals. Our business strategy is underpinned by the drive to provide our clients with an exceptional service. For all your legal advice requirements contact us for a free half hour consultation.
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AN INDIAN’S PERSPECTIVE OF THE HELP TO BUY GOVERNMENT SCHEMES
T
he government has recently introduced a scheme designed to help First Time buyers on to the property market. This scheme is called the Help to Buy Equity Loan scheme. This scheme will give a loan of 20% of the property value, on the basis you provide 5% of the purchase price. This scheme is valid up to a purchase price of £600,000 which is in truth a generous limit. However in practice I doubt whether many First Time buyers will qualify to get a loan up to this limit. At the level of £600,000 one will need to qualify for a £475,000 loan, this means roughly the income combined for a couple will need to be in the region of £100,000. The 20% loan will not need to be paid back for 5 years, and you will not be charged any interest during this period, so in effect you have an interest free loan for this period of time. From year 6 onwards you will need to pay a fee of 1.75% which is a modest amount. This will increase at a rate of RPI + 1% every year.
to save up deposits, this is why the government has brought out this scheme. It is designed to help those with a small deposit get on to the ladder and therefore push demand from the bottom up. The biggest restriction regarding this scheme is it only applies to new build homes. There is another scheme, which the government will roll out in January 2014.
“The aim of helping First Time buyers is to help stimulate the housing market. First Time buyers are seen as an important part of the housing pyramid”
The aim of helping First Time buyers is to help stimulate the housing market. First Time buyers are seen as an important part of the housing pyramid, they exist at the bottom of the pyramid. As they get on to the housing ladder this then pushes the demand to the rest of the pyramid and serves to stimulate the housing market.
This scheme will be similar in the sense that it is still aimed at the same sectors, namely First Time buyers and home movers, it will have the same generous cap of £600,000. However it will vary from the current scheme in that the government will provide a guarantee to the lender for the 20% of the property value, the buyer will still need to come up with the 5% deposit. This means you will be liable to pay interest on the 20% right from the day of purchase, as opposed to having a 5 year interest free period as with the current scheme.
A large block to First Time buyers moving in to the pyramid has been the time taken
This scheme will apply to all types of homes both new build and existing properties.
The scheme has been designed for home movers and First Time buyers.
This is where things can get interesting. If this scheme is used to purchase a property in a location where the prices are rising, you can make a lot of money. For example one client purchased a property in The Water Gardens for £499,000, a year and a half later it’s been valued at £720,000; not by an agent looking to sell the property but by a RICS qualified mortgage surveyor. If we apply this scheme retrospectively to this purchase this means you can purchase a property such as this for £37,000, which is made up of 5% deposit and 3% stamp duty from your pocket, and you would have made £120,000 in equity within a couple of years. Of course the aim of this scheme is not to make money, but to help First Time buyers on to the market; however if one was shrewd this can be used to exploit a rising market. The return on your investment is amplified as you will only be required to put in a fraction of the property value. However this can work both ways, if the property value decreases you can lose more than what you put in. It is important you buy both in an area where the market is rising and also for added insurance you come in cheaper than the market value. The full details of this scheme have not been released as yet but these are the broad details which have been released.
Property Sourcing Expert Suresh Vagjiani Sow & Reap HOUSE AND HOME
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