Welcome to the Withy King Residential Property Bulletin where we aim to help you with your property questions and to keep you up-to-date with Property Market news, trends and statistics.
In this issue:
- Welcome to the Withy King Residential Property Bulletin
- The Buyers Market - an interview with Garrington’s Tessa Carnegie
- Waste Electrical and Electronic Equipment (WEEE) and moving home
- Simple steps towards energy efficiency in your new home
- Investing in Student ‘Digs’
- Is it time to give away your holiday home?
- The Bank of Mum and Dad
- Fairness of renewal commissions to letting agents
- Close to home: Rights of way
Welcome to the Withy King Residential Property Bulletin
Welcome to the introductory edition of the Withy King Residential Property Services bulletin. This newsletter will arrive with you quarterly, by email.
House buying and selling can be stressful for all concerned. At Withy King, we offer a bespoke conveyancing service for our clients. Our team (insert link to ResiProp) provides a knowledgeable service at reasonable rates. Our bespoke service, covering straightforward and complex transactions, is designed for those who want to use a dedicated, personal service, preferring to build a relationship with the person handling their conveyancing.
With offices in Bath, Oxford, Swindon, Marlborough, Abingdon, Thame and London, the Withy King Property team specialists are conveniently placed and are happy to advise you on the service best suited to your needs.
To help you with your property questions and to keep you up-to-date with Property Market news, trends and statistics, the Withy King Residential Property Newsletter will feature relevant and informative articles from internal and external contributors. If your company has an article for publication or would like to be featured in this newsletter, please contact Alison Farina and she will work with you towards publication.
Another feature of this newsletter will be our ‘Close to Home’ section. This section aims to address subjects of common interest with commentary by our Residential Property team member, Chris Macer who will comment on recent developments in property law and their tests.
If you have friends or colleagues who you think will benefit from receiving this newsletter, please have them contact the Marketing Department at Withy King (insert link) and they will be added to our mailing list. We will not pass anyone’s details to a third party.
We hope you enjoy this Residential Property Newsletter and look forward to your comments. If you have any feedback for us, we would love to hear it! Send any questions or comments on this publication to the Marketing Department at Withy King (insert link).
For more information on Withy King, the Property Team, or any of our other services, please visit us on www.withyking.co.uk.
Thank you and all the best,
Ronald Peet
Partner, Head of Residential Property
Withy King
The Buyers Market - an interview with Garrington’s Tessa Carnegie
The property market has witnessed volatile conditions over the last 18 months, but with historically low interest rates, reduced asking prices and the early signs of recovery there are compelling reasons for many to consider buying a property in 2010. There are numerous estate agents available to help vendors through the process but what about the buyer?
Garrington is an independent and privately owned property search consultancy focussing solely on understanding the buyers’ requirements and sourcing and acquiring the best property, ultimately saving them money.
We recently had the pleasure of talking to Garrington’s South consultant, Tessa Carnegie and asked her to talk about the services Garrington provides for property buyers.
WK: How is Garrington different from Estate Agents?
TC: Where estate agents represent the seller, we represent the buyer. When you walk into a showroom to buy a car, the customer is king. Why should it be any different for a house?
WK: Why do people use Garrington?
TC: There are a number of reasons, but the three key ones are:
1. No Time
Our clients range from busy professionals with little time to focus on a search, preferring someone else to do the legwork to investors wanting to stay ahead of the market.
2. No desire
Clients who have no desire to search themselves or who have been frustrated and/or intimidated with their experience of the market and the purchasing process.
3. Knowledge
Some clients feel they simply don’t know where to start, for example overseas buyers who don’t know the process and/or those buyers who are moving to an area and don’t know values or the best towns and villages.
WK: How long have you been in the property industry?
TC: I’ve worked in the prime sector of the property industry for 12 years, the last four of which have been with Garrington, purchasing significant properties for clients throughout Buckinghamshire, Oxfordshire and Gloucestershire.
WK: Why did you join Garrington?
TC: It dawned on me that the only help out there was for the seller rather than the person spending the money, and that got me thinking. I became increasingly aware of Garrington, hearing more and more anecdotes supporting the need for buyer representation. So, I got in touch with them, and the rest is history.
WK: How widely understood is the service you offer?
TC: The concept of what we do is now more widely accepted than it was say four or five years ago (the Garrington brand is 14 years old this year) and in this time we have concentrated on building our brand’s reputation and informing people that we are here to help. As a result, Garrington now fully represents buyers across all key UK regions.
WK: How do clients benefit from using you?
TC: Often we can access properties before they reach the open market (either discreetly available or off-market), which provides clients with complete discretion and anonymity. We specialise in searching for properties at the higher end of the market where there is a shortage of quality homes, erratic-pricing and complex transactions. This sector is where we are able to offer greater financial savings for our clients using our finely tuned negotiation skills, further endorsing the benefits of our service.
Whatever a client’s motivation, we always spend time fully understanding their requirements and the emphasis they place on their property search requirements.
Look out for regular contributions from Tessa Carnegie of Garrington South in future newsletters.
*Waste Electrical and Electronic Equipment (WEEE) and moving home
These days we are all being encouraged to think more carefully about how we dispose of used or broken electrical goods. New electrical and electronic equipment regulations mean that you cannot dispose of them in a skip or hide them in a dustbin.
The WEEE regulations (introduced in July 2007) help us to do this. The new law means that manufacturers and retailers have to help us find a solution and we, as consumers, are expected to play our part.
Moving home is the perfect chance to de-clutter such items. We spoke to Robinsons International Removal Company, who frequently comes across people wanting to get rid of old or broken electrical goods, but leave it too late. Often they end up taking their electrical rubbish to their new home, wasting space, time and money. To help those in this situation, Robinsons has put together these handy guidelines.
What is WEEE?
WEEE is anything having a plug or a battery that you no longer need. It includes everyday electrical items from table lamps and some children’s toys to washing machines tumble dryers and fridges.
Is waste electrical and electronic equipment a big problem?
Waste electrical goods are said to make up the fastest growing waste stream in the UK. It is estimated that 1.4 million tonnes of waste was sold in 2007 alone. Over the years, discarded electrical goods have taken up a great deal of landfill space. As well as using up valuable land, a lot of WEEE contains material that is harmful to the environment, such as heavy metals and organic pollutants, and components that don’t biodegrade.
How should I dispose of it?
All waste electrical and electronic equipment should be disposed of separately – and NEVER dumped in your dustbin. New products are now labeled with a crossed out wheelie bin logo. If you see this symbol it means you must not throw that product out with the rest of your household rubbish.
What do I do with my old electrical equipment?
If you are buying a new kettle, fridge or any other electrical item, the retailer has to offer you help you to dispose of your old item, regardless of whether you bought it in store or online. If you are not replacing an item, you can take your unwanted equipment to a recycling centre yourself, putting it in the appropriately marked WEEE container.
How do these retail schemes work?
Retailers have two choices. They can either run their own take-back scheme on a ‘like for like’ basis. So, if you buy a new electrical product, you can hand over your old item in the store or, if it’s a large piece of equipment, arrange to have it picked up by a ‘collection on delivery’ service. Alternatively, retailers can join a national scheme and provide you with information about WEEE facilities that are available in your local area.
What will I have to pay?
Manufacturers, producers and retailers of the equipment carry the cost of the actual processing or recycling. Retailers can, however, charge you for taking away your old equipment. Most local authorities run bulky waste collection services. You need to contact them direct to find out more details, including any charges made.
What about recycling charities?
Some voluntary organisations will take items like radios and mobiles phones for repair and reuse. Networks, like ‘Freecycle’, encourage the exchange of unwanted items. Your local authority may be able to provide you with a list of reuse charities and networks, or search online with www.recycle-more.co.uk. You can also look for ‘cash for recycling’ schemes and even make money on your unwanted goods!
What happens to the items once taken away?
Where possible, electrical equipment is refurbished for reuse. Anything that can not be reused is broken down into its component parts for recycling as raw materials. Whatever is left is disposed of in the most environmentally friendly way possible.
WEEE and moving – what is the most important piece of advice?
Never leave it to the last minute. We all need take more responsibility for how we dispose of old electrical equipment, so advance planning is key. In the long term, we will all reap the benefits.
For more information on moving home visit www.robinsons-intl.com or for the WEEE regulations visit www.valpak.co.uk.
*Information provided by Robinsons Removals.
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*Simple steps towards energy efficiency in your new home
Moving house is a great opportunity to approach to energy efficiency in the home. Even if you are not moving yet, the following advice will help home owners save money, reduce their carbon dioxide emissions and help prevent climate change.
Before you unpack…
• Tack aluminium foil behind each radiator and fit each one with its own temperature setting dial
• Install draft proof, double-glazed windows and doors
• Top up the attic floor and roof insulation to a depth of 270mm
• Wrap your hot water tank with an insulating blanket at least 75mm thick
• Turn the hot water thermostat down to 60ºC/140ºF
• Make space for a clothes drying rack in the laundry or outbuildings – consider hanging one from the ceiling which can be drawn up and out the way
• If you are buying new appliances, check their energy efficient ratings (EER) and buy the most efficient ones with economy settings. Look for a washing machine with a timer so you can set it to wash at night when electricity is cheaper
• Position your freezer away from any hot appliances and check the door seals are working before filling it up again. Make a note in your diary to defrost it regularly
• When unpacking light fittings and table lamps, replace old light bulbs with energy saving ones (from September 1st 2009 incandescent light bulbs have been banned.)
Once settled in…
• Visit the Energy Savings Trust’s website www.est.org.uk and carry out a personalised home energy check. The Trust calculates that the average household could save up to £300 per year on energy bills and up to two tonnes of carbon dioxide
• Install separate thermostats in each room and make sure all doors close tightly so that you can keep heat in where you want it
• Install a clock thermostat to automatically turn the temperature down to 15oC/60oF at night. Reducing the daytime setting by just 1ºC could cut your heating bills by a further 10% and save around £40 per year
• Wash your clothes at 40º instead of 60º to save 1/3 the electricity
• Fix leaking taps and make sure they're always fully turned off
• Install a timer to control the length of time outdoor lights come on for
• If you have a fireplace, be sure to keep the damper closed when not in use. Consider installing a glass-door fireplace to keep heat from escaping up the chimney.
For more information about moving home, please visit www.robinsons-intl.com or call 01235 552255.
*Information provided by Robinsons Removals.
One of the many dilemmas facing parents with children about to start college or university is where they will live. Buying a property now while prices are depressed, sellers are flexible and interest rates are at an all-time low, could be a very shrewd move, either as a long-term investment or as part of your inheritance tax planning.
The rent your children and their fellow students pay can be used to cover any mortgage repayments and ongoing property maintenance, so there will be few, if any, costs for you to bear, although you will need to measure the impact of Income Tax on that rent.
When you come to sell the property in the future, there will be a Capital Gains Tax assessment on the profit. However, this together with Inheritance Tax may be avoidable if you set up a trust to gift the property and the income generated by it to your dependents.
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Is it time to give away your holiday home?
Owners of furnished, holiday rental properties will have been dismayed to learn of the Government’s plans to change the way they are taxed after April 2010.
Properties which are rented out to holidaymakers for at least 70 days of the year and meet various other criteria, are currently treated as businesses and enjoy certain reliefs from capital gains tax, inheritance tax and income tax.
However, the Government has announced that after the tax year 2009/10, these properties will no longer be classed as businesses and will be taxed in the same way as second homes and other rental properties.
In addition to getting advice from an accountant, anyone affected by the changes should discuss the inheritance tax implications with our Private Client solicitors who specialise in these matters.
One way of benefiting from the reliefs before they disappear, would be to gift the holiday rental property to selected beneficiaries before the 6th April. Provided you live for at least seven years after the gift is made and satisfy certain conditions, the gift will be free of capital gains and inheritance tax.
For a more in-depth discussion of how to make your estate work to benefit you and future generations, please contact David Rich on 01225 425731 or email david.rich@withyking.co.uk
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The Bank of Mum and Dad
This summer will also see many young people who have completed their education, try to get a foot on the property ladder. Parent ‘bankers’ who are in a position to help their children buy a property should consider whether they would like to make a gift or a loan as these have very different implications. In situations where children are married or cohabiting, parents may also want to consider how they would feel about sharing their gift with their child’s spouse or partner and what steps, if any, they’d like to take to guard against this.
Withy King’s residential property team provides expert advice on all aspects of property buying, selling and renting as well as undertaking the conveyancing, drawing up lodgers’ rental agreements and all other legal requirements. They work closely with the firm’s inheritance tax and estate planning specialists to ensure you get the most out of your investment.
For further information on any property-related matter, please contact Robert Collins at Withy King’s Marlborough office on 01672 514781 or email robert.collins@withyking.co.uk; David Atkinson on 01865 792300 or email david.atkinson@withyking.co.uk .Tax matters should be directed to James McNeile on 01225 425731 or email james.mcneile@withyking.co.uk.
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Fairness of renewal commissions to letting agents
Recently the High Court held that a term requiring a consumer landlord to pay renewal commission to a letting agent would not always be unfair under the Unfair Terms in Consumer Contracts Regulations 1999 (the Regulations), but that it needed to be clearly disclosed or actively flagged-up.
The Office of Fair Trading (OFT) asked the High Court whether contracts between landlords and estate agents that provide for a commission to be paid to the estate agent for the introduction of a tenant and on the renewal or extension of a tenancy are unfair under the Regulations.
The High Court applied the following test:
- A typical consumer is reasonably well informed, reasonably circumspect, has read the relevant documents and has sought to understand them.
- Payment of commission on the first period’s rent for finding a tenant was part of the core bargain between the parties, but on the facts, the payment of the renewal commission was not.
- The commission amounts were significant and operated adversely against the landlord the longer time went on, even though the corresponding services were no longer provided by the letting agent. This created a significant imbalance to the parties’ rights and obligations.
- The fairness of the core bargain can be challenged under the Regulations if it is not expressed in plain and intelligible language.
- The renewal commission was only set out in the small print in the standard terms and so not enough had been done to draw it to the attention of the typical consumer, who would not be expecting it.
While the High Court did not assess whether renewal commissions are always unfair to consumer landlords, this decision is important as it is a clear demonstration of the approach that the OFT and the courts will take when considering contract terms under the Regulations.
Brooks v Young (2008)
The Court of Appeal decided that use of "..a right of way at all times…over and along [a rear footpath that passed directly outside the neighbour’s patio and kitchen windows] .. for the purposes of gaining access to and...from the [rear door of the property] for all proper purposes connected with the reasonable enjoyment of the property.." allowed the owner’s visitors to enter via the back door of the property, the owners to take their dog for its walks and their children to use it, at times wheeling bikes, because the terms of the grant did not preclude it.
Our advice:
When buying a property subject to rights of way look very carefully to see whether any rights of way benefit or affect it and ask us to establish in detail what they might be.
Heslop v Bishton (2009)
The owner of land built a gateway, such that the walls and pillars encroached onto a pedestrian right of way over it. Those exercising the right had instead to walk on a small strip of the owner's land not subject to the right of way. The owner did not object, but the Court decided that the owner had been wrong unilaterally to seek to alter the right of way.
Our advice:
Do not assume that the Court will allow what might otherwise seem to be reasonable action to interfere with the rights of others – talk to us before acting.
Smith v Garrard (2004)
A school sold off some building land and a roadway to a developer, but reserved a vehicular right of way over the roadway and imposed a covenant “not at any time to…obstruct the free passage of any part of the roadway…" The Court decided that a right of way such as that reserved did not confer a right to pass over every part of the roadway, so long as sufficient space was left for the convenient and unimpeded use of it.
Our advice:
When selling land off and seeking to impose restrictions on it tell us exactly what you are trying to achieve, as the document must be very carefully drafted.
In our next edition: Car parking rights.
The contents of this article are intended for general information purposes only and do not constitute legal advice. Please contact us, if you have any questions.
